BG Group Sees Tightening of Asian LNG Market

British based BG Group said liquefied natural gas customers in the Asia-Pacific region are looking to negotiate long-term supply contracts earlier than planned as the market is expected to tighten.

Discussing second quarter results, CEO  Sir Frank Chapman said that the overall picture was tightening and "causing particularly Asia-Pacific customers to come back to the table somewhat earlier than planned in order to engage and start to consider the next tranches of long-term supply."

LNG demand in Japan rose to a record high last month as utilities replace nuclear capacity lost after the March tsunami with higher gas burn in power stations.

"The situation in Japan has not affected significantly our trading. It's not the cause of this year's overarching LNG performance, but it has made the environment in which we're working somewhat tighter," Chapman said.

BG Group's second-quarter LNG exports to Asia rose over 40 percent to 20 cargoes, while exports to the U.S., impacted by the expansion of domestic US shale gas production, fell over 60 percent to eight cargoes.