KOGAS receives six LNG supply proposals for 2004 to 2007: Report
Monday, January 26 2004 - 08:45 AM WIB
The source said the requirement is based on growing LNG demand in South Korea, which buys more LNG than any country except Japan, although it may not see as much growth as expected.
"We have made little progress in the deal because we've been considering reducing the amount of LNG sought, as LNG demand during the term may not be as great as we've forecast previously," he said.
He did not elaborate on LNG demand forecasts and said the company had not decided on whether to issue a revised call for tenders.
South Korea's LNG demand is forecast to grow by 4.3 percent a year in the next several years.
In addition to this proposed contract KOGAS will need new supply contracts to replace a long-term one with Indonesia for an annual supply of 2.3 million tons that expires in 2007.
South Korea was estimated to have consumed 19.6 million tons of LNG last year and is likely to use 21.4 million tons this year, according to a state-funded energy think-tank.
KOGAS asked for bids to deliver the cargoes during winter, between October and March, he added. The super-cooled natural gas is used mainly as a fuel for heating in South Korea during winter.
The bidders include almost all of its current suppliers, the company source said.
KOGAS, South Korea's sole LNG importer and wholesaler, imports 19.4 million tons of LNG every year under supply contracts with companies in Indonesia, Malaysia, Brunei, Qatar, Oman and Australia. Most of those contracts will not expire for more than 20 years.
The current suppliers include the North West Shelf venture, operated by Woodside Petroleum, itself part owned by Royal Dutch/Shell, BP Plc, Chevron Texaco and Japan Australian LNG (MIMI) Pty Ltd.
Another supplier is Malaysia's MLNG Tiga, part owned by Malaysian state oil and gas company Petronas, Royal Dutch/Shell and Japan's Nippon Oil. (*)