5 Winning Strategies Turn Challenges into Opportunities in the Global LNG Market
September 16th, 2020
2020 is shaping up to be a tough year for the O&G industry as global supply & demand curves push onshore crude inventories to historic levels. Global LNG markets are also under pressure. While NA LNG exports have improved global access to US gas, European and APAC cash prices are unable to cover supply, liquefaction, and shipping costs. Yet in an article, published by McKinsey, the company outlines a set of winning strategies the LNG industry is taking to weather the current storm.
- Capital efficiency: Leveraging modularization and economies of scale of multi-domestic LNG projects to cut CAPEX development costs
- Supply-chain: Moving away from inflexible long-term contracts in favor of a global LNG marketplace of diversified supply & offtake positions
- Downstream: Focus on LNG players with the capital, capacity, & capability to commit to large import terminal, pipeline & power plant infrastructure projects
- De-carbonization: The (soon to be mandated) trend away from carbon-intensive practices by using energy efficient assets and reducing unplanned gas leaks
- Digitization: Adoption of distributed computing technologies and wireless data connectivity for predictive asset maintenance and forecasting