Strong start for Singapore's first LNG terminal

SLNG CEO Neil McGregor (left) with Minister S Iswaran (second to the left) making the rounds at the LNG terminal (Photo credit: SLNG).

Singapore's first liquefied natural gas (LNG) terminal is about 80 percent complete and on track to begin operations in the second quarter of 2013.

Already, some 90 percent of the terminal's initial production capacity of 3 million tonnes per annum (Mtpa) have been taken up by buyers, said Minister, Prime Minister's Office and Second Minister for Trade & Industry S Iswaran, during a visit to the LNG terminal on Jurong Island early this week.

The terminal, which is being built at a cost of S$1.7 billion, will store imported LNG procured from suppliers all over the world, playing an important role for Singapore, including boosting its energy security and making the country less susceptible to price and supply risks. As a fuel source, LNG is aligned with the city-state's efforts to achieve economic competitiveness and energy efficiency.

Artist impression of LNG terminal with secondary jetty. (Photo credit: SLNG).

The LNG terminal --which will start out with two storage tanks and a primary jetty-- will increase its production capacity to 6Mtpa by the end of 2013, when additional jetties and regasification facilities are completed. The third storage tank is scheduled for completion in early 2014. Each tank, which is 53m high, can hold up to 180,000 cubic metres of LNG, and is big enough to fit three Boeing 747 jets.

BG Singapore Gas Marketing, the current LNG aggregator for Singapore, has an exclusive licence to import LNG and sell up of 3Mtpa of regasified LNG in the country or until the year 2023, whichever is earlier. Due to strong demand for LNG however, the Energy Market Authority (EMA) is preparing a consultation paper to gather industry and public feedback on possible frameworks for future LNG imports beyond what BG has been appointed to do. The consultation paper will be released next month.

Minister Iswaran stressed that the eventual framework should facilitate the city-state's access to a steady supply of LNG, which will be robustly priced in the Singapore context.

The LNG terminal is one plank of Singapore's energy security strategy, which is based on the diversification of energy sources. Besides securing LNG supplies for the city-state, the LNG terminal will also potentially allow Singapore to take advantage of global trends in the gas market and develop as a regional gas hub. This will also drive the creation of new job opportunities for Singaporeans.