[Biz View] LNG Import Volume Expected to Reach Record High

Imports Exceed 30 Million Tons from January to August
8% Increase Compared to Record High in 2018

LNG carrier near the waters off Tokyo, Japan

[Asia Economy Reporter Choi Dae-yeol] The volume of liquefied natural gas (LNG) imports this year is expected to reach an all-time high. This is attributed to the lower emissions burden compared to other fossil fuels and the increase in direct imports for self-consumption by private power generation and other sectors.

According to statistics from the Korea International Trade Association on the 22nd, LNG imports from the beginning of this year through last month totaled 30.64 million tons. This represents a 20% increase compared to the same period last year. The previous peak for LNG imports in South Korea was in 2018, and even compared to the same period (January to August) that year, this year's imports are more than 8% higher.

The surge in LNG demand in 2018 was due to increased heating demand caused by a severe cold wave early in the year and a short-term spike in nuclear power plant maintenance, which led to increased LNG power generation demand. The annual LNG import volume in 2018 was approximately 44.02 million tons. Typically, LNG imports decrease in the summer and increase in the winter when demand is higher. In February this year, imports reached a monthly record high of 5.16 million tons.

LNG Storage Facility in Sakhalin, Russia

In the past, until the 1980s and 1990s, most LNG was imported from Southeast Asian countries such as Indonesia and Malaysia, but since the 2000s, imports from Qatar have increased and supply sources have diversified. South Korea first imported LNG from Qatar in 1999 and has steadily increased imports, becoming the largest importer from the mid-2000s onward.

The United States is the second-largest LNG supplier to South Korea. Since resuming trade in earnest in 2017, imports from the U.S. have steadily increased. The U.S. was the third-largest supplier in 2019 and last year, rising to second place this year. The U.S. is expanding resource exports based on shale resources in the Gulf region, and from the U.S. perspective, South Korea is a major buyer of LNG and crude oil. Following Qatar and the U.S., Australia, the third-largest LNG supplier to South Korea, along with the other two countries, accounts for more than half of South Korea’s total LNG demand.

LNG demand is expected to increase over the coming years. The government plans to reduce the share of nuclear power and increase renewable energy, with LNG serving as an important transitional energy source. Previously, demand was met through volumes imported by Korea Gas Corporation, but private companies can now directly import LNG for factory operations or power plants, leading to a steady increase in direct import volumes. Companies identifying LNG as a new business opportunity are also emerging one by one.

This content was produced with the assistance of AI translation services.