Energy and natural resources
LNG (liquefied natural gas)
Natural gas cooled into a liquid so it can be shipped across oceans.
Last reviewedWhat does LNG (liquefied natural gas) mean?
LNG is natural gas cooled to about minus 162 degrees Celsius, which turns it into a liquid about 600 times smaller in volume, so it can be carried by special ships. The chain has three expensive steps: liquefaction plants (trains) at the export end, shipping, and regasification terminals at the import end. The United States, Qatar and Australia have been the largest exporters; Japan, China, South Korea, India and Europe are large buyers. Example: gas bought at 3 per million British thermal units (MMBtu), plus 2.5 for liquefaction, 1.5 for shipping and 0.5 for regasification, arrives at a cost of about 7.5. Much LNG is sold on long-term contracts, often priced against oil, with the rest traded on the spot market.
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