LONDON: The world's biggest gas exporters will benefit from Japan's increased need for liquefied natural gas (LNG), but the global gas glut that has weighed them down over recent years is unlikely to shrink significantly. Japan's worst recorded earthquake and tsunami Friday shut four nuclear power plants and threatens to keep at least one closed forever, driving up LNG demand for years to come. Russia, the world's biggest gas exporter, and Qatar, the world's biggest LNG exporter, are ready and able to supply Japan with more LNG. Since the quake hit, shares in British LNG giant BG Group, which just days before finalized a 20-year supply deal with Tokyo Gas starting in 2015, have jumped over 7 percent while the FTSE-100 has fallen. French bank Societe Generale estimates extra Japanese demand at 5 billion cubic meters (bcm) this year and remaining at 2 bcm above pre-quake levels of around 88 bcm for years to come. But that increase will make little difference to a global gas market that the International Energy Agency has said could be oversupplied by 200 bcm. If SocGen's prediction that about half of Japan's loss in nuclear capacity from Friday's quake will be replaced by gas is correct, it would need delivery of about one extra tanker carrying 145,000 cubic meters of LNG a week to meet it. “These are very small volumes compared to the supply that is available at the moment. So it will have a slight impact, but it will not put pressure on the market,” said Carlos Torres, a senior gas analyst at Point Carbon, a Thomson Reuters company. “Qatar would definitely have the capacity to supply these volumes without any problem. Due to the geographic proximity of Malaysia, Russia and Australia, these could be logical supply sources also.”
