http://en.wikipedia.org/wiki/LNG
[...] In 1964 the UK and France were the LNG buyers under the world's first LNG trade from Algeria, witnessing a new era of energy. As most LNG plants are located in "stranded" areas not served by pipelines, the costs of LNG treatment and transportation were so huge that development has been slow during the past half century. The construction of an LNG plant costs USD 1-3 billion, a receiving terminal costs USD 0.5-1 billion, and LNG vessels cost USD 0.2-0.3 billion. Compared with the crude oil, the natural gas market is small but mature. The commercial development of LNG is a style called value chain, which means LNG suppliers first confirm the downstream buyers and then sign 20-25 year contracts with strict terms and structures for gas pricing. Only when the customers were confirmed and the development of a greenfield project deemed economically feasible could the sponsors of an LNG project invest in their development and operation. Thus, the LNG business has been regarded as a game of the rich, where only players with strong financial and political resources could get involved. Major international oil companies (IOCs) such as BP, ExxonMobil, Royal Dutch Shell; and national oil companies (NOCs) such as Pertamina, Petronas are active players. Japan, South Korea and Taiwan import large sums of LNG due to their shortage of energy. In 2002 Japan imported 54 million tons of LNG, representing 48% of the LNG trade around the world that year. Also in 2002, South Korea imported 17.7 million tons and Taiwan 5.33 million tons. These three major buyers purchase approximately 70% of the world's LNG demand. In recent years, as more players take part in investment, both in downstream and upstream, and new technologies are adopted, the prices for construction of LNG plants, receiving terminals and vessels have fallen, making LNG a more competitive means of energy distribution. The standard price for a 125,000-cubic-meter LNG vessel built in European and Japanese shipyards used to be USD 250 million. When Korean and Chinese shipyards entered the race, increased competition reduced profit margins and improved efficiency, reducing costs 60%. The per-ton construction cost of a LNG liquefaction plant fell steadily from the 1970s through the 1990s, with the cost reduced approximately 35%. [...
In recent years, as more players take part in investment, both in downstream and upstream, and new technologies are adopted, the prices for construction of LNG plants, receiving terminals and vessels have fallen, making LNG a more competitive means of energy distribution. The standard price for a 125,000-cubic-meter LNG vessel built in European and Japanese shipyards used to be USD 250 million. When Korean and Chinese shipyards entered the race, increased competition reduced profit margins and improved efficiency, reducing costs 60%. The per-ton construction cost of a LNG liquefaction plant fell steadily from the 1970s through the 1990s, with the cost reduced approximately 35%. [...
So Asia Japan, South Korea and Taiwan are 70% of the LNG target market (France is just before Taiwan in importance). Prices are down. Interesting.
Jerome do you know if there are factual errors in the wikipedia stuff?
Investment don't seem that high to me. Pipelines prices quoted here on ET have been in the 10 billions range., here it's less than half, more flexible and going down. I don't know what the relative value of a LNG tanker shipment and oil tanker are though.
It costs you about $3bn for the whole "chain" - for 5bcm (billion cubic meters)
Pipelines cost that much for about 1,000km - to carry 40bcm. Pipelines can be flexible when they plug in a dense network (as in Europe), just like LNG can be flexible when theyre are already more than a few physically accessible alternatives - in the Atlantic basin, for instance (a cargo from Nigeria canbe diverted to the US instead of Europe, for instance, or vice-versa) In the long run, we're all dead. John Maynard Keynes
I assume the LNG limit is the producer LNG terminal, right?
Useful tables:
http://www.lngplants.com/conversiontables.htm
Most LNG producers engage in "de-bottlenecking" at all times - i.e. precisely increasing the capacity of the limiting link at that time. In the long run, we're all dead. John Maynard Keynes