Formation of 'Gaspec' Unlikely
Formation of an group along the lines of the Organisation of Petroleum Exporting Countries for natural gas exporters is unlikely in the immediate future.
A senior official of International Gas Union said that long-term nature of contracts between exporters and importers of natural gas poses a hurdle to the formation of such a group.
"We do not think it is the right way to go because natural gas industry is different from oil, where you have the OPEC. We need long-term relationship and partnership between buyers and sellers. So, cartelisation is not a good idea. At least, it is not happening currently," said Torstein Indrebo, secretary-general of International Gas Union -- the body of natural gas producers and consumers that has 109 members across the world.
Compared to spot oil sales, gas is sold on contracts arranged on much longer terms, as long as 25 years, and a group would have little influence on such arrangements.
Russia and Qatar had floated a proposal to explore creation of a natural gas group to represent the interests of producer countries to influence the global market. Formation of 'GASPEC' was examined by the 14 members of the Gas Exporting Countries' Forum, which included the two proponents, Egypt, Algeria, Nigeria, Bolivia and Venezuela.
Source: Times of Oman