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Too much LNG... for now

The global glut will persist in 2017, but recovery is only a few years away

The global liquefied natural gas market will remain oversupplied and LNG prices under pressure until the early part of the next decade. As a result, in 2017, sellers will be reluctant to commit more capital to an industry in which returns have fallen sharply. But, given the four-to-five-year time-scale for building LNG plants, the industry must anticipate the inevitable recovery and start sanctioning new liquefaction plants before the end of the decade. A 15% increase in global capacity - with over 35m tonnes a year of new supply coming on stream - made 2016 predictably tricky for LNG. Australian projects featured prominently; LNG from America's Sabine Pass plant reached the market too - th

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