Singapore is the most natural location for a regional LNG hub: IEA [News]
By Yvonne Chan, Channel NewsAsia, 1 Mar 2013.
The International Energy Agency (IEA) says the emergence of a trading hub for liquefied natural gas (LNG) could significantly lower price and that would help companies that use it as a source of power.
And Singapore may soon be able to add another spoke to its “hub” status.
The IEA says Singapore is the most natural location to be the regional LNG hub.
Already an important centre for global oil trading, the Republic is being eyed as the next hub for LNG.
Stiff supply contacts presently keep the price of LNG higher than it needs to be.
Current LNG prices are kept artificially high by rigid long-term contracts, or oil price indexation.
For example, the IEA reports that Japan’s import bill for LNG is US$10 billion higher than what it could be in a properly efficient LNG market.
Experts say less regulation and a freer market approach would foster competition and potentially lower prices, which would make the use of LNG in Asia more sustainable in the long term.
According to the IEA, gas consumption in Asia Pacific will outstrip demand by 2017.
Read the full article here.
Source: Channel NewsAsia