popular articles

North America: balancing LNG exports and the transition to renewables

Global demand for U.S. LNG exports is driving gas market expansion in the near term, but growth will slow in the 2030s due to the transition to renewable energy. However, natural gas will continue to play a crucial role in the energy transition.

Please share:

Global demand for U.S. LNG exports continues to drive near-term gas market expansion, driven by continued production growth associated with the Permian and Haynesville fields, according to a recent report from Wood Mackenzie.

Global LNG Demand: Growth Driver and Long-Term Outlook

According to Dulles Wang, director of gas and LNG research for the Americas at Wood Mackenzie, “LNG export growth will drive the market for many years, but will slow significantly in the 2030s, with domestic gas demand peaking in the mid-2030s as demand from the electric power sector gives way to increased renewable energy penetration, albeit at a slower pace than our previous forecast, due to power transmission and gas market resilience constraints.” He also added that “as the gas industry continues to innovate and transform, these low-carbon alternatives will help support demand for natural gas and meet North American emissions reduction goals.”

According to the report, the North American gas market will stabilize at around 150 billion cubic feet per day (bcfd) in the 2040s, an increase of 2 bcfd from the last Wood Mackenzie update in October 2022. The report also notes that beyond 2035, decarbonization initiatives could create a pathway for continued gas demand momentum, particularly in the industrial sector, through carbon capture and underground storage (CCUS), blue hydrogen, renewable natural gas (RNG) and certified gas programs.

“In the context of the energy transition, resilient gas demand and emissions reduction are not necessarily mutually exclusive,” Wang said. “Our forecast shows that natural gas will play a central role in the energy transition in North America, with the rise of blue hydrogen production, low-carbon industrial projects and as a backup source for renewable energy generation. Tax credits and policy support via the Inflation Reduction Act (IRA) and various local and state initiatives in the industrial and transportation sectors are paving the way for increased use of natural gas beyond its traditional form.”

Natural gas: a key pillar in North America’s energy transition

This Wood Mackenzie report highlights the growing importance of natural gas in the North American energy landscape. While demand for U.S. LNG exports continues to drive growth in the near term, the expected slowdown in the 2030s and the transition to more renewable energy sources indicate a changing market. However, the report also notes that natural gas will continue to play a critical role in the energy transition through decarbonization initiatives and low-carbon alternatives such as blue hydrogen and renewable natural gas.

Ultimately, the future of the North American natural gas market will depend on the industry’s ability to adapt to the changes taking place and to seize emerging opportunities. While natural gas demand could peak in the 2030s, decarbonization initiatives offer a way to maintain demand and support emission reduction goals. While the transition to cleaner, more sustainable forms of energy is a priority, natural gas will continue to play a key role in the energy transition in North America.

Register free of charge for uninterrupted access.

Publicite

Recently published in

The potential lifting of U.S. sanctions on the Arctic LNG 2 project paves the way for a rapid resumption of Russian liquefied natural gas exports, significantly impacting global markets from the third quarter of 2025.
Prairie Provident Resources closed 2024 with a reorganisation of its assets and a strategic focus on the Basal Quartz formation, backed by capital raises and revised reserve estimates.
Prairie Provident Resources closed 2024 with a reorganisation of its assets and a strategic focus on the Basal Quartz formation, backed by capital raises and revised reserve estimates.
The Republic of Congo enhances its gas capabilities with the floating platform Nguya, which will add 2.4 million annual tonnes of liquefied natural gas (LNG), solidifying its position in the global market starting in 2025.
The Republic of Congo enhances its gas capabilities with the floating platform Nguya, which will add 2.4 million annual tonnes of liquefied natural gas (LNG), solidifying its position in the global market starting in 2025.
TotalEnergies welcomed the launch of a criminal investigation in Mozambique into allegations of crimes committed by security forces near its suspended gas project in Cabo Delgado province.
TotalEnergies welcomed the launch of a criminal investigation in Mozambique into allegations of crimes committed by security forces near its suspended gas project in Cabo Delgado province.
Baker Hughes will provide integrated coiled-tubing drilling services to Dubai Petroleum Establishment as part of the Margham gas storage project, reinforcing its role in the emirate’s energy security.
Algeria announces an ambitious goal to increase its annual natural gas production to 200 billion cubic meters within five years, supported by significant investments and strategic infrastructure projects aimed at the international market.
Algeria announces an ambitious goal to increase its annual natural gas production to 200 billion cubic meters within five years, supported by significant investments and strategic infrastructure projects aimed at the international market.
Europe is considering various energy strategies up to 2050, revealing highly variable costs and an uncertain future for natural gas demand amid political pressure to achieve carbon neutrality at lower costs.
Europe is considering various energy strategies up to 2050, revealing highly variable costs and an uncertain future for natural gas demand amid political pressure to achieve carbon neutrality at lower costs.
The global liquefied natural gas engine market is expected to double by 2033, fuelled by energy diversification policies, growing refuelling infrastructure and demand for cost-effective transport solutions.
The global liquefied natural gas engine market is expected to double by 2033, fuelled by energy diversification policies, growing refuelling infrastructure and demand for cost-effective transport solutions.
The $4.7bn financing granted by the US Exim Bank to the Mozambique LNG project reignites tensions in the United States over foreign energy policy and national interests.
A study by Wood Mackenzie concludes that liquefied natural gas exported from the United States to Europe generates on average half the emissions of imported coal, when considering the full lifecycle.
A study by Wood Mackenzie concludes that liquefied natural gas exported from the United States to Europe generates on average half the emissions of imported coal, when considering the full lifecycle.
Slovak Prime Minister Robert Fico acknowledged on 20 March significant technical difficulties obstructing a proposed gas swap deal with Azerbaijan, while reaffirming the urgency of restoring Russian gas transit through Ukraine.
Slovak Prime Minister Robert Fico acknowledged on 20 March significant technical difficulties obstructing a proposed gas swap deal with Azerbaijan, while reaffirming the urgency of restoring Russian gas transit through Ukraine.
The Canadian government is financially backing the Cedar LNG project, a gas infrastructure led by the Haisla Nation and Pembina, with an investment of up to $200mn.
The Canadian government is financially backing the Cedar LNG project, a gas infrastructure led by the Haisla Nation and Pembina, with an investment of up to $200mn.
In 2025, Europe faces gas reserves well below usual levels, leading to rising prices and increased pressure on industrial competitiveness amid geopolitical and climatic tensions.
Alpha Generation, LLC plans to add 450 MW of power generation capacity across four existing sites in Maryland, New Jersey, and Ohio. This initiative aims to meet the growing energy demand under PJM’s Reliability Resource Initiative.
Alpha Generation, LLC plans to add 450 MW of power generation capacity across four existing sites in Maryland, New Jersey, and Ohio. This initiative aims to meet the growing energy demand under PJM’s Reliability Resource Initiative.
Equinor has begun gas production at Halten East, a NOK 9 billion project in the Norwegian Sea, two years after receiving approval from Norwegian authorities.
Equinor has begun gas production at Halten East, a NOK 9 billion project in the Norwegian Sea, two years after receiving approval from Norwegian authorities.
Siemens Energy has secured a $1.6 billion contract to supply technologies for the Rumah 2 and Nairyah 2 gas power plants in Saudi Arabia. These facilities will add 3.6 gigawatts to the national grid and include 25-year maintenance agreements.
Siemens Energy has secured a $1.6 billion contract to supply technologies for the Rumah 2 and Nairyah 2 gas power plants in Saudi Arabia. These facilities will add 3.6 gigawatts to the national grid and include 25-year maintenance agreements.
BP has confirmed the cessation of a gas leak at the offshore Grand Tortue Ahmeyim field, located between Senegal and Mauritania. The incident, identified on 19 February at one of the site’s wells, required technical interventions to restore the integrity of the installations.
The United States reactivates a major loan for TotalEnergies' Mozambique LNG project, stalled since 2021 due to a jihadist attack. The funding should enable a market-anticipated restart by 2030.
The United States reactivates a major loan for TotalEnergies' Mozambique LNG project, stalled since 2021 due to a jihadist attack. The funding should enable a market-anticipated restart by 2030.
ExxonMobil has signed a 20-year contract with ARC Resources for LNG supply from the Cedar LNG project, linked to JKM. The deal marks a significant step in global LNG pricing.
ExxonMobil has signed a 20-year contract with ARC Resources for LNG supply from the Cedar LNG project, linked to JKM. The deal marks a significant step in global LNG pricing.
Facing a drop in domestic production, Egypt plans to lease a floating natural gas liquefaction unit in Germany to secure its energy supply.
Facing a drop in domestic production, Egypt plans to lease a floating natural gas liquefaction unit in Germany to secure its energy supply.
Under pressure from US sanctions, Iraq explores alternatives to Iranian gas to secure its electricity supply, notably turning to Qatar and Oman, while considering the installation of floating LNG terminals.
In the context of growing trade tensions with the United States, the European Union strengthens its imports of American liquefied natural gas (LNG) to diversify its energy sources and reduce its dependence on Russian gas.
In the context of growing trade tensions with the United States, the European Union strengthens its imports of American liquefied natural gas (LNG) to diversify its energy sources and reduce its dependence on Russian gas.
Qatar has started supplying natural gas to Syria via Jordan in order to alleviate electricity shortages and support the rebuilding of the country's energy infrastructure.
Qatar has started supplying natural gas to Syria via Jordan in order to alleviate electricity shortages and support the rebuilding of the country's energy infrastructure.
Cameroon has announced the upcoming construction of two gas-fired power plants totaling 500 MW in Bekoko and Douala under public-private partnerships, contingent upon gas supply assurances from the National Hydrocarbons Corporation.
Cameroon has announced the upcoming construction of two gas-fired power plants totaling 500 MW in Bekoko and Douala under public-private partnerships, contingent upon gas supply assurances from the National Hydrocarbons Corporation.

Advertising