NEW YORK, Sept 29 (Reuters) - Liquefied natural gas

(LNG) will be European oil major Shell's biggest contribution to

the energy industry over the next decade in terms of value and

as it seeks to cut emissions from fossil fuel production, CEO

Wael Sawan said on Monday.

Sawan has increased Shell's focus on natural gas to improve

the company's financial performance against its peers in Europe

and the U.S. since taking over as CEO in January 2023, pivoting

away from renewables by pulling out of a number of wind, solar

and other low-carbon ventures.

Sawan said he believes LNG is one of the most effective

fuels in the effort to lower global emissions as it can replace

coal in places like India, China and other Asian countries. He

expects demand for the superchilled fuel to grow 60% between now

and 2040, with LNG making up about 20% of global natural gas

sales by then, up from around 13% at present.

"We are absolutely committed to this sector," Sawan said at

an Economic Club of New York event, noting that the company has

a number of LNG projects planned in Abu Dhabi, Nigeria and

elsewhere.

Sawan, who last week visited Vancouver to celebrate the

company's LNG Canada facility, said the company is still

weighing a few factors before making a final investment decision

on a second phase of the project.

Canadian Prime Minister Mark Carney included the expansion

on a list of five major nation-building projects that he wanted

to see expedited. The plant is the first major LNG export

facility in Canada and the first on the west coast of North

America.

"I don't think I've ever seen the stars as well aligned as I

see now in Canada," Sawan said, noting strong government support

at both the provincial and national level. "Everyone is really

keen on that project materializing."

Still, a decision will depend on Shell's analysis of market

conditions, especially as a massive wave of LNG capacity

additions in the U.S. and elsewhere is expected to hit the

market over the coming years.

"The number of final investment decisions being taken

surprises me, if I'm honest, because it's at the higher end of

the cost curve," he said. "So it's not economically fully

rational."

"Therefore, we need to be able to then judge when is the

right time to bring more capacity," he added.

(Reporting by Shariq Khan in New York; editing by Thomas

Derpinghaus.)