Asia’s Need for Resources Creates Natural Gas Pop
Asia has been moving in on U.S. energy for quite a few months now. They are struggling to support their country’s energy needs, which is causing increased interest here in the states. Natural gas stocks have seen the biggest impacts from this shift in energy consumption. Andrea Tse explains what has been going on.
That said, even before the tsunami hit Japan, the major exploration and production companies were already making hefty investments in LNG projects in Australia and the Asia-Pacific region, Raymond James analyst Stacey Hudson says.
“These companies anticipate hefty growth in Asian gas demand for power generation,” she said.
Hudson also includes India as one of the countries that will continue to exhibit strong demand for energy as they continue to grow.
“There are millions of people in India who do not have access to the power grid. As infrastructure is built out, gas demand for power generation is poised to increase,” she said.
In the meantime, Exxon Mobil(XOM) continues to watch its LNG shipments grow, as the company develops its operations, encouraged by the rising prices.
The Bloomberg report indicates that North American exports could see significant growth by 2016 to feed the Asian demand.
Furthermore, the exports could help these rapidly-growing Asian economies keep inflation from rising oil and coal prices in check.
Trimble of MKM Partners cautions that the same economic conditions that likely will lead to reduced crude oil consumption also will likely put a cap on expectations for ever-increasing LNG demand growth.
Will Asia’s growing need to LNG lead to the natural gas boom we have all been waiting for? Sure seems like it may lead us on that track, however things can always change. Keep track of the LNG industry, looks like it has potential to get interesting!
Quotes taken from report by Andrea Tse, Read the entire article here.
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