Liquefied Natural Gas

DEFINITION of 'Liquefied Natural Gas'

The liquefied state of natural gas, which is created by cooling the gas to about -260°fahrenheit. Energy companies change the state of natural gas into liquid form mainly for ease of transport.

BREAKING DOWN 'Liquefied Natural Gas'

Natural gas in liquid form takes up about 1/600 the volume than when it is in its gaseous state. The liquid state allows companies to efficiently bring the fuel into areas where pipelines are unable to run. Natural gas can be traded through various exchange traded funds or one can buy futures contracts to gain exposure to this commodity.

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