According to Channelnewsasia :
Singapore has decided to import Liquefied Natural Gas (LNG) to meet its future rising demand for energy and to ensure a more stable pricing structure.
It will be developing an LNG terminal which will churn out 3 million tonnes of gas a year when ready in 6 years.
Singapore needs to diversify its energy sources to ensure it is not over-reliant on a single source for its energy needs.
Speaking at the inaugural Energy Market Authority forum, Trade and Industry Minister Lim Hng Kiang said, as such, the government was inviting investors to build an LNG terminal expected to cost about half a billion US dollars.
In the long term, this could help ensure more stable electricity prices.
He said: “For LNG, because of the heavy investments in the chain, in the ships, in the facility itself, these tend to be fairly long contracts, therefore prices tend to be more stable. Whereas, piped gas, if they are linked to fuel oil prices, then they tend to be more volatile.”
Mr Lim said this was a big investment and the government would consider co-funding the project if necessary.
Singapore now gets its piped natural gas supplies from Indonesia and Malaysia which fuel 80 percent of its power generation.
But it has been looking at alternative sources, especially after a power outage two years ago disrupted gas flow to its power stations via Indonesia’s pipelines, plunging part of the country into darkness.
Besides inviting bids to build and run the terminal, the Energy Market Authority is also seeking industry feedback on issues such as where best to locate the project.
It expects to assess the bids and select a winning one by the first quarter of 2008.
Industry players have till the first half of next year – when preparations for request-for-proposals are expected to be firmed up – to have their say.
Still to be ironed out are issues like the terminal ownership structure, the business model and the regulatory framework.
At the forum, it was also revealed that the government’s decision to introduce competition into the electricity market has reaped results.
Singapore’s ranking for electricity price competitiveness has improved 13 places.
It has achieved 29th position out of 47 countries last year, up from 42nd out of 48 countries in 2001.
This is based on the International Price Competitiveness Ranking by the Institute for Management Development in Switzerland.
In addition, while fuel oil prices have increased by about 100 percent over the last three years, electricity tariffs in Singapore have risen by only about 27 percent over the same period.
- This piece of old news demands new place in this blog!!! In 6 years time, 2012 our LNG terminal will be ready for imports from many countries….hopefully the prices then would be REALLY competitive! Otherwise…it will be darkness for us!
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