ID :
187011
Tue, 06/07/2011 - 14:27
Auther :
Shortlink :
https://oananews.org//node/187011
The shortlink copeid
LOCAL GAS INDUSTRY FACE CHALLENGE IN GETTING NATURAL GAS TO BE AT MARKET PRICE
KUALA LUMPUR, June 7 (Bernama) -- The local gas industry faces the challenge
of enabling natural gas to be at the market price, given that the industry has a
bright future going forward, says the president of the Malaysian Gas Association
and International Gas Union, Dr Abdul Rahim Hashim.
He said the government subsidy for gas is not sustainable in the long run.
"If you subsidise all the time, it's not sustainable for the future. So, the
price has to come to the market price and the challenge is, how this can be
done," he told Bernama, after chairing the "Conventional vs Unconventional Gas"
session at the 16th Asia Oil and Gas conference 2011 here, Tuesday.
He said the natural gas price should be heading to that of the market within
the next five years.
"A review on gas prices every six months and subsidies lifted on a gradual
basis to lessen the impact, are among ways prices can be at the market
level," he added.
Asked about the current demand for gas, he said there is more demand than
supply.
"But due to a market distortion, it is hard to determine if the demand is
real or driven by artificial pricing.
"Therefore, it's very difficult to ascertain the current demand. If
prices are at market price, then you can determine the situation," he added.
Abdul Rahim also stated that the regasification plant projects in Malaysia
would help bring gas prices to the market price.
"The regasification project will surely help. There will be more gas
available in the market at market prices and at the same time, allow for a third
party access. So, it's good to have that facility,' he explained.
Petronas Gas Bhd is undertaking Malaysia’s first RM3 billion (US$1=RM3)
liquefied natural gas (LNG) regasification plant in Melaka while the second
project for an integrated downstream oil and gas complex is in Pengerang, Johor.
Recently, the Federation of Malaysian Manufacturers (FMM) asked the
government to set a better benchmark for natural gas pricing, rather than use
fuel oil prices as the benchmark for the market price.
FMM stated it recognised that natural gas needs to move to the market price,
especially in anticipation of the liberalisation in natural gas supply, through
third party imports when construction of the Melaka regasification plant
is completed in 2012.
Abdul Rahim also said the country should not rely on a single fuel but a
multitude of energy sources along with coal, oil and gas in addressing the
energy requirements in the country.
of enabling natural gas to be at the market price, given that the industry has a
bright future going forward, says the president of the Malaysian Gas Association
and International Gas Union, Dr Abdul Rahim Hashim.
He said the government subsidy for gas is not sustainable in the long run.
"If you subsidise all the time, it's not sustainable for the future. So, the
price has to come to the market price and the challenge is, how this can be
done," he told Bernama, after chairing the "Conventional vs Unconventional Gas"
session at the 16th Asia Oil and Gas conference 2011 here, Tuesday.
He said the natural gas price should be heading to that of the market within
the next five years.
"A review on gas prices every six months and subsidies lifted on a gradual
basis to lessen the impact, are among ways prices can be at the market
level," he added.
Asked about the current demand for gas, he said there is more demand than
supply.
"But due to a market distortion, it is hard to determine if the demand is
real or driven by artificial pricing.
"Therefore, it's very difficult to ascertain the current demand. If
prices are at market price, then you can determine the situation," he added.
Abdul Rahim also stated that the regasification plant projects in Malaysia
would help bring gas prices to the market price.
"The regasification project will surely help. There will be more gas
available in the market at market prices and at the same time, allow for a third
party access. So, it's good to have that facility,' he explained.
Petronas Gas Bhd is undertaking Malaysia’s first RM3 billion (US$1=RM3)
liquefied natural gas (LNG) regasification plant in Melaka while the second
project for an integrated downstream oil and gas complex is in Pengerang, Johor.
Recently, the Federation of Malaysian Manufacturers (FMM) asked the
government to set a better benchmark for natural gas pricing, rather than use
fuel oil prices as the benchmark for the market price.
FMM stated it recognised that natural gas needs to move to the market price,
especially in anticipation of the liberalisation in natural gas supply, through
third party imports when construction of the Melaka regasification plant
is completed in 2012.
Abdul Rahim also said the country should not rely on a single fuel but a
multitude of energy sources along with coal, oil and gas in addressing the
energy requirements in the country.
