KEY CONCLUSIONS
The Asia-Pacific is the largest consumer of energy
resources in the world
“The Asia-Pacific is one of the most rapidly developing,
from an economic point of view, regions in the world. At the same time, it
consumes the most energy resources because the economy and the population
continue to grow”, — Liu Hongpeng, Director, Energy Division, United Nations
Economic and Social Commission for Asia and the Pacific (ESCAP); The Global
Energy Prize Expert
“It is expected that the Asia-Pacific region will see a
34% increase in LNG consumption by 2022. Asia will account for over 70% of the
import of these resources”, — Liu Hongpeng, Director, Energy Division, United
Nations Economic and Social Commission for Asia and the Pacific (ESCAP); The
Global Energy Prize Expert
Liquified natural gas is the most promising energy export
“By implementing small scale energy projects using LNG,
we’ll be able to offer, for the first time, a supply of clean energy to rural
regions and increase the population’s standards of living. Today we’re talking
about a ‘virtual’ pipeline – we don’t need to build long gas pipelines to
supply gas across a long distance – we can build modest gas supply ships and
ensure LNG deliveries. We should think not just about economic value and
profits, but about human impact. We must put people first. By launching small
scale LNG energy projects, we can reduce poverty and facilitate the development
of manufacturing in rural regions”, — Alan Lau, President Director, PT Anglo
Euro Energy Indonesia; Member of Taskforce on LNG, United Nations Economic
Commission for Europe
“Current government policy is focused on improving the
island’s environmental situation. Green technology and the use of liquified
natural gas have been identified as promising avenues of development. Sri Lanka
is transitioning to clean sources of energy and intends to gradually reduce
dependence on coal. Although the country’s economy is small, we have a large
potential for growth, so LNG deliveries may rise to a significant volume”, —
Merrille Godfrey Abeywickrama Goonetilleke, Additional Secretary, Ministry of
Power and Renewable Energy of the Democratic Socialist Republic of Sri Lanka
“LNG has many advantages – a reduced environmental
footprint, convenient transport – so in large part, the growth in LNG
consumption is the result of a transition from coal power plants to gas”, —
Liao Xianchun, Professor, Research Institute of Green Development, Jinan University
“From the point of view of infrastructure and economic
opportunities for delivering gas along pipelines, the delivery of these natural
resources (LNG) is very promising. The LNG market in the Asia-Pacific has been
growing recently”, — Liu Hongpeng, Director, Energy Division, United Nations
Economic and Social Commission for Asia and the Pacific (ESCAP); The Global
Energy Prize Expert
Development of the LNG market requires new business
models
“In any case, LNG is a very promising model for Asia, but it demands an absolutely novel approach to business integration and profit is gained through a completely different process”, — Tatyana Mitrova, Director, Energy Centre, SKOLKOVO Moscow School of Management
PROBLEMS
Lack of gas
“Currently 2000 MW [of Bangladesh’s energy capacity -
Ed.] remains unused because of a lack of gas”, — Mohammad Hossain, Director
General, Power Cell Division, Ministry of Power, Energy and Mineral Resources
of the People’s Republic of Bangladesh
Insufficient funds to convert generation from coal to gas
“Where funds are lacking, in regions that have trouble
attracting investment, countries will continue to use coal. The smallest
capital intensity and energy resource price – these are the key factors in the
choice between natural gas and coal”, — Tural Gadirli, Portfolio Manager, QBF
Portfolio Management
“The main competitor to natural gas is coal. Currently,
natural gas is losing out to coal, even if we take into account harmful emissions”,
— Tural Gadirli, Portfolio Manager, QBF Portfolio Management
Financial risks for LNG suppliers
“Clients are increasingly paying attention to spot
indices, which increases financial risk for suppliers. Contracts are becoming
shorter and smaller and, accordingly, to sell the same quantity of LNG you need
to work very quickly and market actively to sell your surplus LNG”, — Tatyana
Mitrova, Director, Energy Centre, SKOLKOVO Moscow School of Management
“There’s another important moment with new consumers. Many of them don’t have very high credit ratings. These are developing countries, where national risks are far higher. From the supplier’s point of view, it’s rather difficult to make the decision to work with such countries”, — Tatyana Mitrova, Director, Energy Centre, SKOLKOVO Moscow School of Management
SOLUTIONS
Creating new terminals for LNG
“We are expanding partnership opportunities and plan to
create floating regasification units and build new terminals”, — Mohammad
Hossain, Director General, Power Cell Division, Ministry of Power, Energy and
Mineral Resources of the People’s Republic of Bangladesh
Optimizing contract and project financing mechanisms
“We must preserve a certain about of flexibility and room
to maneuver. If we make the decision that energy must be cheaper, we would need
to take action with regard to gas prices. This is why it is vital to structure
demand correctly”, — Merrille Godfrey Abeywickrama Goonetilleke, Additional
Secretary, Ministry of Power and Renewable Energy of the Democratic Socialist
Republic of Sri Lanka
“We’re talking about innovative paths, for example, small
projects, about customers. The role of users, consumers is growing, and that
can be included in contracts. Usually suppliers start to search for more
flexibility in terms of their service contracts, and that flexibility comes
from the price”, — Monica Sun, Partner, Herbert Smith Freehills LLP
“Sustainable development requires a widescale dialogue
between suppliers and consumers. We need to find project financing mechanisms
and contract procedure mechanisms that, maybe, don’t yet exist, some sort of
mutual guarantees, including with development banks. We need to create a new
foundation, new technologies, and new business models”, — Tatyana Mitrova,
Director, Energy Centre, SKOLKOVO Moscow School of Management
