Shell (NYSE:SHEL) said on Monday that worldwide demand for liquefied natural gas is projected to rise significantly in the coming decades, increasing from about 422 million tonnes per year in 2025 to between 610 million and 780 million tonnes annually by 2050.
According to the energy group, this implies growth of roughly 45% to 85% over the next 25 years.
Shell added that additional investment in LNG supply capacity will be needed during the 2030s and 2040s in order to satisfy demand even at the lower end of its long-term projections.
The company noted that its current LNG facilities, along with projects under development, are positioned competitively within the lower half of the industry’s cost curve.
Demand expansion through 2040 is expected to be largely driven by Asia, which Shell estimates will account for about 70% of the increase in LNG consumption.
At present, LNG makes up around 14% of global natural gas supply, equivalent to just over 3% of total primary energy supply. Shell expects LNG’s share to rise to above 4% by 2040 and remain roughly at that level through 2050.