Eric Watkins
Senior Correspondent
LOS ANGELES, Sept. 18 -- Singapore plans to construct a $1 billion LNG terminal and regasification plant on a 30-ha site in southwest Jurong Island to diversify its natural gas imports.
Singapore Power subsidiary PowerGas, designated as majority owner and operator of the facility, expects to begin construction in 2009 and to have the plant operational by early 2012.
Earlier this month, Singapore Minister of State for Trade and Industry S. Iswaran said at the LNG Supplies for Asian Markets conference that detailed engineering and construction should start immediately. The project was approved in August 2006.
Singapore, which relies on gas transported from neighboring Indonesia and Malaysia, is trying to diversify its sources of supply. Supplier Indonesia, in particular, has less gas to export as it seeks to meet domestic demand growth (OGJ Online, Mar. 1, 2007).
Iswaran said initial demand is expected to be 1 million tonnes/year in 2012 when the plant starts operations. It will take 4-5 years for the contracted LNG quantity to reach 3 million tonnes/year, he said.
PowerGas, currently in charge of the national gas pipeline grid, can ensure that the LNG terminal is efficiently integrated with the system and can help manage periodic gas demand and supply imbalances by adjusting supply from the terminal.
"But we have left the door wide open for other parties, both local and international, to join in," Iswaran said, suggesting that other players could partner with PowerGas as minority stakeholders.
Sole LNG importer sought
Singapore also has launched a request for proposals from interested parties to bid on becoming the initial sole importer of LNG into the plant. The importer-consortium (or aggregator) will import an initial 3 million tonnes/year of LNG into the country.
Singapore's Energy Market Authority will select and appoint the aggregator from a short list of candidates by second quarter 2008.
Analyst BMI said Singapore's overall gas demand is forecast to rise to 10 billion cu m by 2011 from the estimated 6.7 billion cu m in 2006. The proportion used in power generation likely will remain well above 90%.
Contact Eric Watkins at [email protected].