NEW YORK, Nov 10 (Reuters) - U.S. imports of liquefied natural gas are likely to rise as the global economic slump depresses demand in many of the Asian markets that typically buy the fuel, a Sempra Energy (SRE.N) executive said on Monday.
“Japan, Korea, and China, the typical Asian countries that have been taking LNG, are not taking as much. So it’s creating a surplus and it’s got to find a home,” Mark Snell, chief financial officer of Sempra, told Reuters.
LNG is natural gas that is cooled to a liquid form and moved by specially designed ships around the globe. Upon delivery to a terminal, the LNG is returned to gaseous form and delivered through pipelines.
“The United States, at the end of the day, has sort of become the buyer of last resort ... it looks like (the United States) is going to get a lot more gas than we originally had anticipated just because worldwide demand is slacking,” he said.
U.S. LNG imports had lagged industry expectation this year, falling to about 325 billion cubic feet, compared with 770.12 bcf for the whole of 2007, according to the data published by Waterborne Consultants last month.
That drop has been attributed to huge demand in Asia, where high gas prices have drawn cargoes out of the Atlantic to the Pacific market.
Some traders are now saying that Asian storage tanks are full and spot cargoes will not be needed in these markets until later in the year, maybe into January.
An increase in U.S. LNG imports into the Gulf of Mexico region could benefit Sempra, since much of that gas would likely be injected into storage facilities that hold the fuel until the high-demand winter heating season begins.
In August, Sempra opened the Energia Costa Azul LNG terminal on Mexico’s Baja California. That plant is designed to ship gas to Mexico and into the U.S. Southwest, especially California. (Reporting by Matt Daily; Editing by Walter Bagley)