Singapore’s state-backed Pavilion Energy highlighted the strong potential for small-scale LNG in southeast Asia at the 7th LNG Asia Pacific Summit on 9 September.
Pavilion Energy plans to develop small-scale supply solutions for the region and is in talks with several partners in markets such as Indonesia and the Philippines, according to Seah Moon Ming, the group CEO.
The small-scale LNG market is gaining momentum in southeast Asia because it is considered a cost-effective solution for transporting natural gas to users not connected to pipeline grids or located in remote locations.
“It makes sense to use small 10,000cbm vessels carrying 0.05-0.5mtpa of LNG to perform multi-location deliveries,” he said at the CWC conference in Singapore.
Whether transported via land or sea, small-scale LNG solutions can also bring an initial capital expenditure investment down by 10-25 times as compared to conventional methods, he said.
Aside from emerging and prospective small-scale LNG markets in Indonesia and the Philippines, Pavilion Energy also plans to sell LNG through truck-loading services to downstream users with no access to pipeline gas in Singapore.
A supplier involved in the discussions with Pavilion Energy confirmed with ICIS that both companies see huge potential for the LNG truck-delivery market. However, it will be a tricky process because of Singapore’s strict safety regulations on delivering inflammable products, the source said.
“Singapore’s downstream market is huge because there are many power generators, large petrochemical factories and manufacturers in Tuas and Jurong Island that do not have access LNG,” the source told ICIS.
According to Seah, Pavilion Energy currently supplies gas to more than 30% of industrial users in the power generation, petrochemicals, biotechnology, pharmaceutical and manufacturing industries.
Pavilion Energy is also working on an LNG bunkering trial and license, as it foresees Singapore becoming a strategic location for LNG-fuelled vessels to refuel when they head through the Straits of Malacca, Seah said.
Over the long term, Seah expects LNG demand from southeast Asia to rise, when traditional LNG exporters such as Malaysia and Indonesia become net importers to meet rising domestic consumption.
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