Demand for gas in Asia to increase
SINGAPORE: The demand for liquified natural gas (LNG) is expected to increase in Asia, and Singapore is set to tap the significant market growth, says International Enterprise (IE) Singapore chief executive officer Teo Eng Cheong.
“For the growth of Asia’s LNG industry to remain strong, the marketplace needs a dynamic environment. As Asia’s top oil hub, Singapore is well positioned to also be the regional hub for LNG.
“Today, Singapore is the gateway to key LNG markets.
“More than 400 petroleum and petroleum trading companies are already based here,” he said in his address at the opening of the World LNG Series: Asia Pacific Summit here yesterday.
Teo said while Singapore may not be a major LNG consumer or supplier, it had seen strong and steady growth in its LNG trading sector in recent years.
Shell was among the first energy majors to establish LNG marketing and trading activities in Singapore while other key players include BP, BG Group and Gazprom.
Teo said more energy companies have also started new LNG trading businesses here.
“Just this year, we witnessed new entrants to the cluster, including Gunvor, Vitol, and PetroChina.
“We are very encouraged by this progress.
“It showcases the potential of the LNG industry in playing a greater role in contributing to Singapore’s economy.”
“Many projects that are set to boost the growth of our LNG eco-system are already in the pipeline,” he said, adding that the construction of Singapore’s first LNG terminal is on track to commence commercial operations by mid-2013.
As the government agency responsible for promoting the republic’s trade, Teo said IE Singapore will continue to work with interested players to facilitate entry and growth of their operations in Singapore.
Teo said the long-term outlook for gas market was also strong as countries were diversifying their energy sources by seeking alternatives to oil and coal, and are switching to cleaner fuels like petrol gas.
By 2030, he said natural gas demand is projected to increase by 60 per cent to overtake coal in the global energy mix, to become the second most dominant source of energy globally.
He also pointed the global use of nuclear as an energy source has slowed significantly since Japan was hit by a tsunami and earthquake in March.
Most of the future action, he said would be seen in emerging markets.
He said 80 per cent of the growth is expected to be in non-OECD (Organisation for Economic Co-operation and Development) countries by 2035, largely driven by the emerging economies of Asia.
China’s demand for natural gas alone is projected to grow more than five times from the current 20 billion cubic metres to 110 billion cubic metres by 2015.
He said while South-East Asia was traditionally a LNG exporting region, with no importers, this was expected to change by 2015.
Teo said 10 LNG import terminals with a total import capacity of some 34 billion cubic metres were possibly coming online in the region.
Several recent trends further underscored Asia’s role in the evolution of the global LNG market.
He said Asia’s LNG demand surged strongly after the 2008 financial crisis.
It is expected to grow faster than supply in the coming years.
The supply situation is only expected to ease after 2015, when more LNG production projects and supply options come on-stream. — Bernama