Singapore government takes over development of first LNG terminal

Jun 30, 2009, 5:44 GMT

   Singapore - The Singapore government said Tuesday it will take over the development of the city-state's first liquefied natural gas (LNG) terminal and has postponed the start of its operations by a year to 2013.

   In September 2007, the government originally appointed Powergas, a subsidiary of Singapore Power Group, to develop and operate the LNG terminal.

   However, amid the global economic downturn it had become significantly more challenging for Powergas to proceed with the project on a commercial basis as originally intended, Singapore Senior Minister for Trade and Industry S Iswaran said.

   'Having reviewed the situation ... the government has decided to take over the ownership and development of the LNG terminal in Singapore,' the minister told participants of a conference on LNG business in the Asia-Pacific.

   The city-state's Energy Market Authority would set up a company, the Singapore LNG Corporation, for this purpose.

   'The aim is to ensure that the terminal is completed and operational by 2013,' said Iswaran.

   The LNG terminal to be built on Singapore's Jurong Island was originally scheduled to take its first gas delivery by 2012.

   'The LNG terminal is ... essential for Singapore's energy security,' the minister said.

   In addition, it would generate further opportunities for trading.

   'We believe that Singapore is in a good position to become a major player in the LNG trade in Asia,' Iswaran said.

   The outlook for the world economy remained challenging and posed uncertainty for the global energy markets.

   'However, the fundamentals of the Asia-Pacific LNG market remain strong in the medium to longer term, fuelled by the growth of emerging markets in Asia,' he added.