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Low oil prices could boost appeal of gas in Asia

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World Coal,

Low oil prices will help to lower LNG prices in the near future, potentially boosting demand for gas-to-power projects in the region, according to Frost & Sullivan, although its appeal will be partially challenged by uncertainties in overall oil and gas investments.

Japanese-landed LNG will see the sharpest decline, according to the consultancy, to nearly US$12/million BTU by 2020, if the current trend continues.

Low LNG prices could also invigorate the gas-to-power market in China where the government has committed to reducing pollution levels by investing in cleaner fuels.

On the downside, prolonged low gas prices are likely to delay or result in the cancellation of some LNG projects in Australia and East Africa, which may not be viable without significant cost reduction.

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