A top executive at the company that dropped the Lake Charles LNG project in late March over financial concerns remains bullish on liquefied natural gas.
Shell, the world’s top liquefied natural gas trader, is confident that the global LNG market will return to the levels before the COVID-19 pandemic, chief executive Ben van Beurden told Bloomberg in an interview published last week.
“We will obviously flex our investment program to be aligned with where we believe the sector will go, but the profitability of the business and the outlook of this business is going to be as good as what you saw before the pandemic,” van Beurden told Bloomberg.
Shell said in its annual LNG Outlook 2020 in February that longer-term demand was expected to double to 700 million tons by 2040, while in the short term, balance would be restored by 2021 due to slower supply growth. But that was before the pandemic.
After the oil price crash, Shell walked away from the proposed Lake Charles LNG project in Louisiana in late March, citing initiatives “to preserve cash and reinforce the resilience of our business.”
Even so, Shell “still very much believe that with the current supply-demand outlook, this is a fundamentally strong sector that will grow at a rate that is close to 4% per year,” van Beurden told Bloomberg.