Energy Insights

Energy Insights

What is LNG?

Liquefied natural gas (LNG) is natural gas that has been cooled to a liquid state, at about -260° Fahrenheit, for shipping and storage. The volume of natural gas in its liquid state is about 600 times smaller than its volume in its gaseous state. This process makes it possible to transport natural gas to places pipelines do not reach.

Why LNG?

LNG increases markets for natural gas. Where natural gas pipelines are not feasible or do not exist, liquefying natural gas is a way to move natural gas from producing regions to markets, such as to and from the United States and other countries.

Liquefied natural gas (LNG) terminals and transportation vessels create an outlet for natural gas produced in the United States to reach markets in Asia and Europe, which face a global energy crunch because of high demand and lower supplies. During the next 10 years, the U.S. Energy Information Administration (EIA) projects that the United States will see its most rapid period of growth; net exports of U.S. natural gas are expected to nearly double as the United States expands its LNG infrastructure and produces high volumes of natural gas.

How is LNG shipped?

LNG export facilities receive natural gas by pipeline and liquefy the gas for transport on special ocean-going LNG ships or tankers. Most LNG is transported by tankers called LNG carriers in large, onboard, super-cooled (cryogenic) tanks.

At import terminals, LNG is offloaded from ships and is stored in cryogenic storage tanks before it is returned to its gaseous state or regasified. After regasification, the natural gas is transported by pipelines to natural gas-fired power plants, industrial facilities, and residential and commercial customers.

LNG exports

The United States was a net exporter of LNG in 2017 through 2020 (exports were greater than imports), largely because of increases in U.S. natural gas production, declines in natural gas imports by pipeline and as LNG, and increases in LNG export terminal capacity, according to EIA.

The top five destination countries for U.S. LNG exports in 2020 were South Korea, Japan, China, Spain and the United Kingdom.

LNG imports

LNG imports to the U.S. declined in most years since 2007 as increases in U.S. natural gas production and expansion of the natural gas pipeline network reduced the need to import natural gas.

In 2020, the United States imported LNG from just four places: Trinidad and Tobago, Nigeria, Norway and Canada. This was the lowest amount since 1996.

The Everett regasification terminal near Boston receives most U.S. LNG imports. LNG imports help New England states meet natural gas demand because the region currently has limited pipeline interconnections with the Northeast and other U.S. natural gas producing regions. Sources: EIA.gov and energy.gov