ID :
358888
Tue, 03/03/2015 - 10:13
Auther :

Asia To Remain Leading LNG Export Market For Foreseeable Future, Says Iswaran

SINGAPORE, March 3 (Bernama) -- Asia will remain the leading Liquefied Natural Gas (LNG) export market for the foreseeable future despite the challenging environment, including a deep plunge in crude oil prices, says Singapore Minister in the Prime Minister's office, S Iswaran. In his address at the 10th edition of the LNG Supplies for Asian Markets (LNGA) conference here, he said the global LNG market had changed significantly in the last year. "When we met at last year’s LNGA conference, the market outlook was optimistic on the back of growing global demand for natural gas, and new natural gas projects coming online. "Since then, the most striking market development has been the sharp fall in crude oil prices. Brent crude price has decreased some 50 per cent since the middle of 2014. "We are also starting to see new LNG supplies come online in 2015," added Iswaran, who is also Second Minister for Home Affairs & Second Minister for Trade & Industry. Australia is expected to add LNG supplies from at least three new projects in 2015 alone – Gorgon, Gladstone and Australia Pacific. In the United States, the Sabine Pass LNG project is on track to commence operations in late 2015. These new supplies are expected to ease the tight global gas market. According to Iswaran, Asian demand for LNG is expected to remain subdued in the near future, with key buyers such as Japan, South Korea, China and India forecasting lower LNG demand, or its growth, for their needs. He said the present market conditions suggest a favourable shift towards Asian LNG buyers. Asian LNG spot prices have fallen from a monthly average of US$14/mmbtu (in October 2014) to present levels of around US$6-7/one million British Thermal Units (BTU) (for April 2015 delivery). Iswaran said on the other hand, for LNG producers, the downward pressure on oil prices may affect the viability and sustainability of new and planned LNG projects. "In fact, the low oil prices have already eroded the margins of some LNG producers, leading to the shelving or postponement of some projects. "Continuing weakness in oil prices may make it even more challenging for projects to commit to their investments. Given the uncertain and challenging environment in the short term, adjustments and consolidation can be expected. "However, consumers and producers should take a long-term view in order to ride out these cycles. Natural gas, being the cleanest fossil fuel, will continue to be, and grow as a significant part of Asia’s energy mix," he added. He said many Asian countries had already made a long-term commitment to natural gas, and many LNG import terminals currently under construction or being planned around the world are in Asia. These, he highlighted, include neighbouring Malaysia and Indonesia, China, Japan and the Philippines and was confident that Asia will remain the leading LNG export market for the foreseeable future. -- BERNAMA

X