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Competing for LNG in the Global Gas Market
National Association of Regulatory Utility Commissioners


 Mike Zenker
 Barcla...
At first look, LNG imports to the US
seem to be booming
                                              Source country:
    ...
Demand for Gas in the US driven by Power Sector

                               30000
                                    ...
Domestic Gas Production Challenged
to Sustain Growth

                                                                  US...
Growth in Global LNG Supply


                                        Pacific (bcfd)
                                   6 ...
Demand for Gas More Robust Outside of Europe/North
America


                              90


                          ...
Price Competition: Other Countries Sign Long-term, Oil-
linked LNG Contracts
                                           Na...
Outlook for Global LNG Liquefaction Capacity Additions

                                      16000
                      ...
Questions?




             Thank You

                         9
Disclaimer
This presentation has been prepared by Barclays Capital, the investment banking division of Barclays Bank PLC (...
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Transcript of "Competing for LNG in the Global Gas Market"

  1. 1. Competing for LNG in the Global Gas Market National Association of Regulatory Utility Commissioners Mike Zenker Barclays Capital Research (415) 765-4743 November 12, 2007 Please read carefully the important disclosures at the end of this publication.
  2. 2. At first look, LNG imports to the US seem to be booming Source country: 3500 UAE Oman 3000 Brunei Malaysia Million Cubic Feet per Day 2500 Indonesia Australia 2000 Algeria Guinea Qatar 1500 Egypt Nigeria 1000 Trinidad 500 0 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 Source: EIA. 2
  3. 3. Demand for Gas in the US driven by Power Sector 30000 Power Sector Consumption 28000 of Natural Gas 26000 Million Cubic Feet per Day 24000 22000 20000 18000 16000 14000 12000 10000 02 03 04 05 06 07 08 09 10 11 12 20 20 20 20 20 20 20 20 20 20 20 Source: EIA, Barclays Capital. 3
  4. 4. Domestic Gas Production Challenged to Sustain Growth US Gas Production 60000 1600 US Gas Production (million cubic feet per Gas-directed Drilling Rigs 1400 50000 1200 Gas-directed Rigs 40000 1000 day) 30000 800 600 20000 400 10000 200 0 0 2000 1992 1994 1996 1998 2000 2002 2004 2006 Source: Baker Hughes, EIA. 4
  5. 5. Growth in Global LNG Supply Pacific (bcfd) 6 Middle East (bcfd) Atlantic (bcfd) 5 Billion Cubic Feet per Day 4 3 2 1 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: EIA, Barclays Capital. 5
  6. 6. Demand for Gas More Robust Outside of Europe/North America 90 80 Billion cubic feet per day 70 60 50 40 30 20 1990 1992 1994 1996 1998 2000 2002 2004 2006 Asia/ ME/ Africa North America Europe (ex- Russia) Source: BP, Barclays Capital. 6
  7. 7. Price Competition: Other Countries Sign Long-term, Oil- linked LNG Contracts Natural Gas Price Significant premium of oil- 15 Crude Oil Price linked LNG compared to US 90 14 natural gas prices 80 13 12 Natural Gas (dollars per MMBtu) 70 Crude Oil (dollars per barrel) 11 10 60 9 50 8 7 40 6 5 30 4 3 20 2 10 1 0 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Source: NYMEX, Barclays Capital. 7
  8. 8. Outlook for Global LNG Liquefaction Capacity Additions 16000 US + Canadian Terminal Capacity 14000 Imports 12000 Million Cubic Feet per Day 10000 8000 6000 4000 2000 0 2004 2005 2006 2007* 2008 2009 2010 Source: EIA, Barclays Capital. 8
  9. 9. Questions? Thank You 9
  10. 10. Disclaimer This presentation has been prepared by Barclays Capital, the investment banking division of Barclays Bank PLC ("Barclays"), for information purposes only. This document is an indicative summary of the terms and conditions of the securities/transactions described herein and may be amended, superseded or replaced by subsequent summaries. The final terms and conditions of the securities/transactions will be set out in full in the applicable offering document(s) or binding transaction document(s). This document shall not constitute an underwriting commitment, an offer of financing, an offer to sell, or the solicitation of an offer to buy any securities described herein, which shall be subject to Barclays’ internal approvals. No transaction or service related thereto is contemplated without Barclays' subsequent formal agreement. Barclays is acting solely as principal and not as advisor or fiduciary. Accordingly you must independently determine, with your own advisors, the appropriateness for you of the securities/transaction before investing or transacting. Barclays accepts no liability whatsoever for any consequential losses arising from the use of this document or reliance on the information contained herein. Barclays does not guarantee the accuracy or completeness of information which is contained in this document and which is stated to have been obtained from or is based upon trade and statistical services or other third party sources. Any data on past performance, modelling or back-testing contained herein is no indication as to future performance. No representation is made as to the reasonableness of the assumptions made within or the accuracy or completeness of any modelling or back-testing. All opinions and estimates are given as of the date hereof and are subject to change. The value of any investment may fluctuate as a result of market changes. The information in this document is not intended to predict actual results and no assurances are given with respect thereto. Barclays, its affiliates and the individuals associated therewith may (in various capacities) have positions or deal in transactions or securities (or related derivatives) identical or similar to those described herein. This document is being made available in the UK to persons who are investment professionals as defined in Article 19 of the FSMA 2000 (Financial Promotion Order) 2005. Outside of the UK, it is directed at persons who have professional experience in matters relating to investments. Any investments to which this document relates will be entered into only with such persons. This document is not for distribution to retail customers. NO ACTION HAS BEEN MADE OR WILL BE TAKEN THAT WOULD PERMIT A PUBLIC OFFERING OF THE SECURITIES DESCRIBED HEREIN IN ANY JURISDICTION IN WHICH ACTION FOR THAT PURPOSE IS REQUIRED. NO OFFERS, SALES, RESALES OR DELIVERY OF THE SECURITIES DESCRIBED HEREIN OR DISTRIBUTION OF ANY OFFERING MATERIAL RELATING TO SUCH SECURITIES MAY BE MADE IN OR FROM ANY JURISDICTION EXCEPT IN CIRCUMSTANCES WHICH WILL RESULT IN COMPLIANCE WITH ANY APPLICABLE LAWS AND REGULATIONS AND WHICH WILL NOT IMPOSE ANY OBLIGATION ON BARCLAYS OR ANY OF ITS AFFILIATES. THIS DOCUMENT DOES NOT DISCLOSE ALL THE RISKS AND OTHER SIGNIFICANT ISSUES RELATED TO AN INVESTMENT IN THE SECURITIES/TRANSACTIONS. PRIOR TO TRANSACTING, POTENTIAL INVESTORS SHOULD ENSURE THAT THEY FULLY UNDERSTAND THE TERMS OF THE SECURITIES/TRANSACTION AND ANY APPLICABLE RISKS. THIS DOCUMENT IS NOT A PROSPECTUS FOR ANY SECURITIES DESCRIBED HEREIN. INVESTORS SHOULD ONLY SUBSCRIBE FOR ANY TRANSFERABLE SECURITIES DESCRIBED HEREIN ON THE BASIS OF INFORMATION IN THE RELEVANT PROSPECTUS (WHICH HAS BEEN OR WILL BE PUBLISHED AND MAY BE OBTAINED FROM BARCLAYS), AND NOT ON THE BASIS OF ANY INFORMATION PROVIDED HEREIN. Barclays Bank PLC is registered in England No. 1026167. Registered Office: 1 Churchill Place, London E14 5HP. Copyright Barclays Bank PLC, 2007 (all rights reserved). This document is confidential, and no part of it may be reproduced, distributed or transmitted without the prior written permission of Barclays. Barclays Capital is the investment banking division of Barclays Bank PLC, which is authorised and regulated by the UK Financial Services Authority and a member of the London Stock Exchange. 10
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