Asian, Middle Eastern gas producers told to cooperate
Asian, Middle Eastern gas producers told to cooperate
PATTAYA, Thailand (AP): Asian and Middle Eastern gas producers should join hands to benefit from the growing market for gas fuel in Asia, especially in China and India, a top official said Monday.
Considering the potential size of these two markets, competition among suppliers of liquefied natural gas, or LNG, has been intense, said Mohamad Hasan Marican, president of Petronas, Malaysia's state oil and gas company.
In the long run, such competition may be "detrimental to the future growth of the industry," he said in a speech at the Gasex 2000 conference. The three-day conference, which began Monday, has brought together more than 450 representatives of state-run gas companies and national gas associations from 15 Asia-Pacific countries.
"Perhaps the time has come for the Middle East and East Asia's gas suppliers to explore a mutually beneficial trade-off or cooperative competition to fully optimize the potentials that could be derived from the rebirth of Asia's gas market - a win- win solution to both producers and consumers," Mohamad said.
With petroleum prices having reached an all-time high, the biannual conference is discussing ways to promote natural gas as a cheaper and cleaner fuel for electricity generation, municipal heating, cooking and transport.
China is among the most promising new markets in Asia, and its demand for natural gas is expected to increase four times by 2010 to match or even outrank traditional buyers such as Japan, Taiwan and South Korea.
The three countries together accounted for 37 percent of natural gas consumed in the Asia-Pacific region in 1999, according to statistics from the oil company, BP Amoco.
Delegates at the conference also are expected to discuss a planned 27,000-kilometer (16,666-mile) natural gas pipeline network connecting Southeast Asian nations with eastern Asia, said Songkriet Tansamrit of the Petroleum Authority of Thailand, the conference host.
The pipeline will transport natural gas from production fields in Malaysia and Indonesia to consumer centers in China and possibly Japan, Taiwan and South Korea. It is slated for completion in 2010.
A theme likely to emerge at the conference is the development of LNG as a tradable commodity, conference organizers said.
Generally, LNG contracts are negotiated for 25 to 30 years, because of the heavy infrastructure and capital requirements involved. End-user desire for more flexibility in the face of demand fluctuation may lead to the development of a swap market in LNG, officials say.
In a speech at the conference, Thai Industry Minister Suwat Liptapanlop said his country is promoting the use of compressed natural gas as a vehicle fuel, and trying it out on public transportation as an initial step toward replacing petroleum products.