(EnergyAsia, November 20 2014, Thursday) — Singapore and Malaysia should cooperate to jointly create a location and pricing service to serve the fast-growing liquefied natural gas trade (LNG) in Asia, said the CEO of Singapore’s state-owned Pavilion Energy Pte Ltd.
Seah Moon Ming said Asia urgently needs transparent LNG pricing and price discovery that are essential for the development of a platform for the the fuel to be traded.
Speaking at an energy conference in Kuala Lumpur, he said Singapore and Malaysia should combine their respective strengths to jointly develop this platform to enable traders to create a regional LNG price marker and futures contracts.
“It is timely for the two countries to work together towards an Asian LNG hub as their locations in the Straits of Malacca and South China Sea are host to some of the world’s vital sea lanes with about 50% of global LNG supplies passing through each year,” he said in his keynote address at the International New York Times Energy For Tomorrow Conference.
“The Asian LNG hub would benefit many countries, even suppliers of LNG. The US, a major supplier of LNG, has taken an interest in this initiative.”
The two Southeast Asian countries have strong and groing ties: today, Singapore is Malaysia’s largest foreign investor while Malaysia is Singapore’s second largest trading partner. Bilateral trade reached almost S$114 billion last year. (US$1=S$1.3).
Malaysia is one of the world’s largest LNG exporters while Singapore is a major oil trading hub.