LNG Supplies for Asian Markets (LNGA 2010)

Press Clipping

Upstreamonline, Tuesday, February 09, 2010

By Amanda Battersby

SLNG ready to add tanks

Singapore LNG (SLNG) will build up to four more liquefied natural gas storage tanks at its grassroots import/export facility if third party demand warrants it.

SLNG will have a nominal capacity of 3.5 million tonnes per annum and is being built with two initial 188,000-cubic metre storage tanks.

Samsung’s recently-awarded engineering, procurement and construction contract carries an option for a third storage tank of similar size, plus there is space at the 30-hectare site on Jurong Island for up to three more tanks, Energy Market Authority chief executive Lawrence Wong told the LNG Supplies for Asian Markets conference, organised by Conference Connection.

SLNG is scheduled to receive its initial imports in 2013 but early days demand from local customers is expected to be only about half of aggregator BG Group’s maximum 3 million tpa quota.

The facility will also be able to handle third party volumes for storage and re-export.

“We intend to use the spare capacity for trading. Any boil off will be attributable to the domestic market,” said Wong, a sweetener that he believes will prove tempting to prospective users of the storage facilities. “This compares to a typical boil off of 4% per month for floating LNG storage.”

SLNG is also considering other ways to leverage the facilities at the project site including more regasification capacity, possible storage for liquid petroleum gas, and a second jetty – like the first, capable of accommodating the new Q-Flex tankers.

Wong added that several companies had already expressed interest in the potential of the planned storage and re-export facilities. He noted that Singapore was already a successful oil trading hub despite having no indigenous hydrocarbon production and that it was aiming to become an LNG trading hub too.

Russian gas giant Gazprom recently opened an office in Singapore to oversee its Asian trading operations while US supermajor ConocoPhillips has decided to relocate its global LNG business from Houston to Singapore, he revealed.

“It is my hope that the new LNG terminal will be a catalyst for Singapore to become a major LNG hub in future,” said SLNG executive director Neil McGregor.