Singapore LNG infrastructure investment could boost two-way trading capacity

The FSRU project will bolster the country’s LNG re-export.

Singapore is poised to be a “two-way” liquified natural gas (LNG) trader on the back of its investment in a new floating storage and regasification unit (FSRU), according to a  BMI report.

BMI said that the five million tonnes per annum (mtpa)  FSRU is driven by the need to address supply disruptions from potential loss of pipeline gas imports from Malaysia and Indonesia, boost the share of natural gas in its energy mix, and its goal to be a regional hub for LNG trading.

“The new project is expected to offer Singapore the flexibility to deploy the FSRU closer to consumers and allow SLNG to cater to the burgeoning LNG bunkering business,” the report read.

BMI said Singapore is in a strategic location that gives it an advantage in capturing emerging LNG bunker trading business opportunities.

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The project’s completion will also enhance its re-exports to regional markets as export volumes to neighbouring countries such as Malaysia remain low.

“With the incremental growth in LNG trade, driven by the emergence of new LNG importers like Vietnam and the Philippines, Singapore could establish itself as a key player in LNG transhipment and capture opportunities in the LNG trading market, particularly due to its geographic proximity to these emerging frontier markets,” the report said.

The country currently operates a terminal that supplies around half of its natural gas demand for power generation. The remaining demand was supplied by pipeline gas.

Its imports rose to 3.7 mtpa in 2023 from 2.1 mtpa in 2015.