PERTH Feb 25 Asian spot prices of liquefied
natural gas (LNG) held steady this week, hovering at the $10 per
million British thermal unit (mmBtu) mark in a very thinly
"There are little pockets of demand for the second half of
March and April, but nothing dramatic at the moment. It's
looking pretty stable in terms of pricing," one Singapore-based
trade source said.
The onset of spring in top LNG consumers Japan, South Korea,
and Taiwan has kept spot demand relatively low, sources said.
Japan will see mostly warmer-than-average weather this summer,
Japan's forecaster said this week.
"The spot market is in a transition period from the winter
to the spring. There are some buyers who are looking for spot
LNG, but most of the shopping has already been done," one
Japan-based trade source said.
Some importing countries may also have considerable
stockpiles of the fuel.
"February has been a very warm month as well in Asia, so you
will see the inventory levels have been quite sustainable,"
another Singapore-based trade source said.
Taiwan was still in the market for cargoes, with its tender
for parcels from March through June, due to close soon, trade
The warmer weather may be causing U.S. re-exports of LNG to
wane, with only one re-export during February and none are
expected in March, Waterborne LNG analysts said in a note this
"The U.S. Gulf Coast, which has witnessed a flurry of
during this winter, seems to be on hiatus," Waterborne said,
adding that a lack of available LNG tankers may be an additional
reason for the drop in re-exports.
The spread between U.S. and British prices -- which helps
determine the flow of LNG in the Atlantic -- was just above
$4.80 per mmBtu in favour of Britain on Friday, up from $4.60
last week, Reuters data showed. <0#NG-NGLNM=R>
SOUTH AMERICAN DEMAND
In a sign of growing South American demand for LNG,
Argentina's state energy company said the nation could double
its LNG imports in 2011 to between 45 and 50 cargoes.
A joint regasification plant supplying Uruguay and Argentina
should start operations in January 2013, Uruguayan President
Jose Mujica said this week. The plant would process 10 million
cubic metres of natural gas per day.
Asia will continue to be the world's top consuming region
for natural gas, but is likely to increase its share of the
supplies it consumes to two-thirds, up from 50-55 percent
currently, a senior analyst at Credit Suisse said this week.
China is expected to be a major contributor to that demand
and on Friday one of the state's energy companies, Sinopec,
clinched the second-largest single Chinese LNG deal, agreeing to
buy 4.3 million tonnes of LNG per year starting 2015 from
Australia Pacific LNG.
China's LNG imports for January rose 4.8 percent from a year
earlier, but fell short of December's volumes, a record 1.03
million tonnes of the super-chilled fuel, the data showed.
India, also expected to represent a major part of Asia's LNG
demand growth, may more than double 2010 import levels to 20
million tonnes by 2017.
(Editing by Ramthan Hussain)