Sunday, November 4, 2007
To ensure steady supply given rising global demand for the commodity
KOREA Gas Corporation (Kogas) is pushing to extend its liquefied natural gas (LNG) deal with Brunei in a bid to ensure continued supply given increasing global demand for LNG.
"I'd like to express our strong interest to extend our contract at the existing market price," said Kogas Vice-President Kwon Young-Sik in a talk held by the Brunei Energy Association yesterday.
Kogas' proposal to extend its existing contract with Brunei stems from the increasing demand for gas, especially with fast-growing nations such as China and India having voracious appetite for gas and oil.
A deficiency in the Asian market and surplus in the Atlantic market is also one of the reasons behind the decision.
Kogas' contract with Brunei LNG Sdn Bhd (BLNG) will expire in 2013.
In the deal, Kogas agreed to purchase 0.7 million tonnes of LNG per annum.
However, there is a possibility that Kogas will consider increasing the volume if a renewed contract goes through.
"The growth of world LNG trade is driven by increasing demand and declining domestic natural gas resources in gas-consuming countries, and by the desire of gas-producing countries to commercialise their resources," said Pehin Orang Kaya Seri Utama Dato Seri Setia Haji Yahya Begawan Mudim Dato Paduka Haji Bakar, Minister of Energy at the Prime Minister's Office, in his opening speech.
By 2020, natural gas will account for 25 per cent of the global primary energy consumption, which is an increase of one per cent from the demand in 2003. Demand is seen to remain stable.
To meet this demand, BLNG plans to increase production capacity by upgrading its facilities.
It started its power plant rejuvenation project in December 2005.
The project involves building a new combined-cycle power plant to replace generation in the existing plant.
The move is seen to allow BLNG to cater to existing requirements and also increased demand.
Brunei LNG is also adding new tankers to its fleet to ensure secure, sustainable and reliable production and transportation of LNG to buyers.
Considered as the fourth-largest producer of LNG in the world, Brunei Darussalam produces roughly 215 million cargoes of natural gas annually and exports 90 per cent of it to Japan.
The Brunei Times
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