Judging by every forecast and indicator, Asia’s liquefied natural gas (LNG) industry is due to experience an explosion of activity over the coming years – metaphorically speaking, of course.
Both supply and demand for LNG continue their rapid increase, with significant upticks in Australian production capacity as well as Chinese market growth. Meanwhile, China’s recent imposition of tariffs against imports of American LNG (among other things) is already inspiring US distributors to seek alternative customers, leaving the Chinese market more open than ever before.
Furthermore, plans are underway to establish an Asian LNG trading hub, converting the energy source into a true commodity within the next five years. Due to its advantageous location, regulatory system and infrastructure, Singapore is the most commonly cited new home for LNG trade in Asia, joining other proposed regional hubs elsewhere around the globe.
Racing towards a new era
During periods of change, there is always an increasingly intense period of jockeying for position, as organisations up and down the supply chain compete to establish themselves as leaders in their corner of the market. The rewards are considerable; Asia-Pacific already represents the lion’s share of the world market for LNG, accounting for 72% of current LNG purchases. That number is likely to increase in the near future, with trends indicating that China, Japan and South Korea will be the top destinations in the world LNG market moving forward.
Even greater than the regional competition will be the supply race at the global level, with the US, Qatar and Australia each focusing their efforts on becoming the major supplier in Asia’s new LNG era.
The upshot of all this activity is that someone is going to have to operate and manage all of the production and logistics associated with growing demand for LNG in Asia. As we all know, whenever there is rapid market growth somewhere in the value chain, there is an inevitable shortage of experienced talent. This adds to the sense of urgency as industry players compete for qualified leadership to bolster their position.
At such times, real talent is at a premium. It is therefore highly worthwhile for industry leaders to recognise the value of innovative and effective leadership in the current market environment, and upgrade their skills to meet the challenges that lie ahead.
Eventually, the market will mature. Supply and demand will find a stable balance, and clear leaders will emerge at every level of the LNG distribution process. Until then, however, time is of the essence; and companies and talent alike should make the best use of the opportunities of the present moment.