Pavilion Energy Signs 10 Year LNG Deal With Gazprom
Pavilion Energy has signed a 10-year LNG agreement with Gazprom, Seah Moon Ming, company's Executive Director & Chief Executive Officer announced Tuesday during his address at Gastech 2015.
Without giving further details about the deal, he said that supplies from the Russian firm is expected to commence in next two to three years.
Pavilion Energy has also signed a memorandum of understanding (MoU) with China Huadian to supply cargoes of LNG to the company from 2020 onwards. Seah further announced that Pavilion has also signed an MoU with Japan's JERA for collaboration in joint LNG procurement and investment. JERA is a joint venture set up by Tokyo Electric Power (Tepco) and Chubu Electric Power to handle fuel procurement.
“Pavilion Energy is currently focused on developing regional demand. We see this as an important step towards building a reliable and robust LNG ecosystem in Singapore, and hopefully for Asia,” he said.
Seah said he strongly believes in Singapore's potential to be a significant global LNG trading hub.
“It is home to the vast majority of the world's largest commodity trading companies. This extensive network of buyers and sellers creates an effective and neutral market place for global traders to structure their deals,” he said.
LNG demand shift to Asia
Speaking on the long term LNG dynamics, Seah said Asia plays an important role in the global demand for LNG due to an increase in population, urbanisation of cities and development of Infrastructure.
“Today, Asia accounts for 76% of global LNG demand. China and India will contribute most to the demand growth of LNG, and would account for half of total growth from 2016 to 2020. Stronger environmental controls and government intervention to switch from coal to gas will further contribute to China's rising appetite for LNG. Natural gas will continue to be important to the Chinese industry as it re-gears in coming years. I am confident that China would pick up from the slowdown and maintain its consistent growth in the mid-term of about 7%,” he said.
Seah said he sees LNG demand in Southeast Asia to also rise with traditional exporters of LNG, like Malaysia and Indonesia becoming net importers in the near future due to rising domestic demand.
“China, India and Southeast Asia may well become the next "JKT" of LNG imports,” he said.
On the supply side, by 2020, the U.S. and Australia may reach 40% of total global LNG supply, he said. East Africa could also be a key contributor towards LNG supply growth, with Mozambique and Tanzania starting to deliver natural gas in 2020's.