Wood Mackenzie: Can Canada Capitalise on Asia’s Need for Long-Term, Lower-Carbon LNG?

As a growing number of LNG projects compete for scarce capital to reach final investment decisions, Canada may have a limited opportunity to secure a larger position in the next phase of global LNG supply growth, according to new analysis from Wood Mackenzie. Asia’s long-term energy security will increasingly depend on diversified, reliable and lower-carbon LNG supply. Canada is emerging as a compelling long-term supplier due to its proximity to Asia and lower carbon intensity.

 

The Canadian Momentum

 

Canada’s LNG sector is growing. A major expansion was sanctioned. It doubles capacity. Other projects are under construction. Exports will rise.

The sector remains below ambition. A leader set a high target. This covers export capacity. Current projects fall short. The gap is large.

 

The Market Shift

 

Global markets are shifting. Disruptions exposed risks. Buyers reassess strategies. Diversification is a priority. This spans geography and carbon.

Asian demand is set to grow. It could double by 2060. Much remains uncontracted. This creates opportunity. New suppliers can enter.

 

The Demand Centres

 

Growth concentrates in regions. South and Southeast Asia lead. These are key destinations. Long-term deals will flow there. They need supply.

These markets are price-sensitive. They resist high costs. LNG supports growth. Affordability matters. Buyers seek balance.

 

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The Competition

 

Canada faces strong competition. Many projects compete. They seek capital. They chase buyers. Options are growing.

Competition is intensifying. Several projects reached decisions. These span the US. Others progress elsewhere. The next years are decisive.

 

The Priorities for Canada

 

Analysts identified priorities. Cost competitiveness features. Regulatory certainty matters. Financing solutions are needed. Government engagement is key.

The priorities address risks. High costs weigh on projects. Permitting must improve. New financing is required. Diplomacy supports contracting.

 

Significance of the Analysis

 

Canada offers real advantages. It has resource scale. It is close to Asia. Shipping routes are short. Carbon intensity is lower.

Canada must execute well. Its advantage must translate. Projects must be investable. They must be executable. Timing will decide the outcome.