Just released McKinsey Energy Insights research shows that the global LNG supply glut is being exacerbated by the 100 million tonnes of new export capacity under construction in the US and Australia, and that by the time Australia becomes the world's largest LNG exporter oversupply will peak at 60MMtpa.

That means few new LNG projects will reach final investment decision over the next two years.

Woodside Petroleum CEO Peter Coleman told the company's investor strategy day in Sydney recently that the company was timing FID on its Browse LNG project for when the LNG world would need new capacity again, by the early to mid-2020s.

Projects expected to be developed in the short-term include Royal Dutch Shell's Prelude floating LNG in Australia, PFLNG-Satu and Bintulu LNG train 9 in Malaysia, and Yamal LNG Train 1 in Russia.

With the world's LNG export capacity currently above 310.8MMtpa, an additional 30.8MMtpa is expected to be added by the end of 2016 and annual additions are expected to increase by 37% in 2017.

Demand is expected to plateau over the next two years. Reduced demand from Japan will likely be made up by growth from China and India. Both of these factors increase the risk of a short-term demand-supply imbalance.

When it does come, further Asian demand growth is like to be captured by low-cost developments in Papua New Guinea, or the US, where import terminals can be reversed at a minimal cost compared to even brownfield expansions at existing export facilities.

McKinsey has modelled 10 LNG projects at the final investment decision stage—including Coral FLNG and Mozambique LNG—against its Energy Insights LNG cost curve.

"Our research shows that the current market oversupply is creating challenging conditions for operators hoping to take FID on projects in the near term," McKinsey specialist James Walker said.

"For these projects to be viable they would require an assumption of either a sustained high LNG price post-2024 or a cost optimisation strategy to reduce projected capital expenditures.

"Many projects will struggle to secure enough firm buyers in an oversupplied market. Even if projects do manage to progress to construction, the LNG supply will be hitting the market at a bad time."

The research highlights that the market will remain oversupplied unless today's low prices can stimulate a demand recovery. However, to date, the demand response to the low LNG prices seen in the past two years has been limited.

But new research from GlobalData suggests that significant liquefaction and regasification capacity growth in North America and Asia will drive the global LNG industry over the next four years.

The consultancy says that North America leads the world in planned liquefaction capacity additions planned by 2020, and that of 75 planned liquefaction plants under consideration 42 are planned to start operations in North America.

GlobalData said North American companies such as Cheniere Energy, United LNG and Orca LNG are likely to develop additional trains.

Cancellations of planned liquefaction facilities have led to a 7% decrease of planned global capacity, from 800MMtpa six months ago to 743MMmtpa. They include Shtokman in Russia, Equatorial Guinea Train II, BHP Billiton's endlessly-delayed Pilbara FLNG project around the remote Scarborough gas field and Pacific Rubiales FLNG project in Colombia.

A total of 13 LNG regasification projects were added since GlobalData's LNG capacity report in November 2015, including Iran FSRU, Damerjog in Djibouti, and Gorskaya FSRU in Russia.

Demand for natural gas in Asia is continuing to drive regasification capacity growth, with India and China expected to have the highest capital expenditure of all countries to bring planned regasification terminals online.

Indeed, it is expected that an estimated sum of $US17.1 billion will be spent between 2016 and 2020 to increase regasification capacity by 7.4 trillion cubic feet in the two countries.

In terms of regasification capacity, Korea Gas Corporation has the highest in the world and will remain the global leader for the next four years.

Companies such as Kuwait Petroleum Corporation, China Petrochemical Corporation and Excelerate Energy will lead the construction of regasification terminals in the world.

Douglas-Westwood says the US Henry Hub marker was an average of just $US1.92/MMBtu in May, down by almost 60% since 2014, and that presents limited economic incentives for companies to commit to capital intensive development projects in a period plagued with budget austerity, which could limit US LNG exports.

DW said the role of gas in making sure meeting the COP21 commitment to limiting global temperature increase to 1.5 degrees by the middle of the century is achievable is vital, and that there is plenty of gas to develop,

"This is the window of opportunity to implement constructive legislative strategies to help switch industries with heavy carbon footprints, such as the maritime industry to gas. Such a shift in legislative strategy and improvement in technology will increase both the appeal and use of a fuel that could help lower the global carbon footprint," DW said.