While fracking technology has placed the US as the world’s largest natural gas producer, the lack of approved LNG export terminals has prevented energy companies from competing in the growing global LNG market, says an analyst with GlobalData.

According to Carmine Rositano, GlobalData’s Managing Analyst covering Downstream Oil & Gas, the global LNG capacity will increase at an average 10% per year from 2013 to 2017.

Meanwhile, the US LNG capacity will be competing with new liquefaction coming online in Papua New Guinea and Australia, with the Gladstone, Gorgon, Wheatstone and Queensland terminals increasing Australia’s LNG capacity by 10 billion cubic feet per day over 2013 levels.

Furthermore, GlobalData forecasts that the US liquefaction will only have a 5% share of the global LNG capacity in 2017, while Australia and Qatar will have 20% and 16%, respectively.

Rositano said, “Asia will remain the key market for LNG, but other areas, such as Europe, will increase their LNG imports as they seek to reduce their dependence on gas supplies from Russia.”

GlobalData believes that while President Barack Obama’s administration has supported the export of LNG, acquiring all the necessary local, state, environmental and federal approvals is a herculean task that takes many years to finalise. A key disadvantage within the approval process is that exports from US facilities can only be sold to countries with Free Trade Agreements (FTAs). Only special approval from the Department of Energy (DOE) can allow exportation to non-FTA countries, where most of the LNG demand is located, according to GlobalData.

Despite the hurdles, the analyst believes that there are many advantages in building LNG export facilities, including more employment opportunities, increasing local revenues and lowered trade deficit.

“With economic advantages and reduced geopolitical risks on the line, there is an evident need to fast-track LNG projects, allowing the US to maximise benefits from its domestic energy resource base,” Rositano concluded.