A pivotal time for US LNG and Asia’s future energy needs

– by Paul Everingham

As the CEO of an organisation that is very much focused on Asia’s current and future energy needs, it’s a pivotal time to be travelling to the United States. 

The recently announced US LNG export approval pause is a cause of great concern for Asia. 

This concern comes not only countries like Japan, South Korea, Singapore, Taiwan and Thailand, where gas has long had an established role in energy systems. 

It also comes from emerging Asia, where many nations remain reliant on coal but view gas – accessed through LNG imports – as fuel that will allow them to keep meeting rising energy demand while also reducing carbon emissions from power generation. 

Some of these nations, such as Vietnam and the Philippines, have only just started their LNG journeys but now face uncertainty around a major source of supply. 

My first stop in the US will be Washington DC, where I am looking forward to engaging with a range of political, government and energy industry figures and providing some Asian perspective on the pause. 

The message will be quite simple. As an energy importing region, any reduction or restriction to future LNG supply will put energy security in Asia very much at risk. 

There are no winners when lights go out and industries have to curtail production. 

Secondly, if Asia’s emerging nations are unable to secure LNG in the volumes they require – or if constrained supply leads to prices rises – it will be detrimental to our planet’s health and global net zero aspirations. 

The unfortunate reality is that when LNG becomes unobtainable as a result of either supply or pricing, less wealthy nations in Asia (and elsewhere) inevitably fall back on inexpensive and plentiful coal. The past two years of record worldwide coal use following Russia’s invasion of Ukraine are clear evidence of this. 

Policymakers in South and Southeast Asia must make decisions today about what their energy systems will look like decades into the future. 

Most would like to see growing investment in renewables supported by increased adoption of gas, a significant portion of it sourced from the US. But without confidence in the long-term future of US LNG, their practical options will be limited and may involve having to seek gas supply from nations where environmental standards are not as stringent (such as Russia and Iran). 

Following my trip to Washington, I’m headed to Houston for CERAWeek, which is always one of the most impactful and engaging events on the energy world calendar. 

CERAWeek 2023 was the first I attended in person and it will be interesting to compare the feeling at that event with the 2024 edition. 

Last year the mood at CERAWeek was very upbeat, with widespread acknowledgement of the role of natural gas in global energy security. Europe’s successful pivot to LNG after the Ukraine invasion was a major factor behind that. 

This year the LNG export approval pause will serve as a backdrop to CERAWeek but my instinct is that conversations will remain positive and forward-facing. The energy industry is very resilient and accustomed to thriving in times of adversity.  

Over the past decade, US LNG has proven enormously beneficial for countries right around the world, including in Asia. 

By working with key stakeholders and outlining the full context of those benefits, we are taking steps to ensure this can continue for decades to come. 

Paul Everingham is the inaugural CEO of the Asia Natural Gas and Energy Association (ANGEA), which works with governments, society and industry throughout Asia to build effective and integrated energy policies that meet each country’s climate objectives. Connect with him on LinkedIn.

Photo by PartTime Portraits on Unsplash