Middle Eastern country Qatar will launch first LNG market and supposedly be taken by storm by other gas exporting countries, as it will lead to transparent pricing and opaque marketing of LNG.
Qatar has decided to commence its market operations to trade liquefied natural gas (LNG) in spite of the fears of formation of cartel by gas exporting countries due to forging faster links being high. Emirates wish to lead the global trade of LNG by creating LNG contract, which would be situated at IMEX, energy exchange to be commenced this year in Doha, according to news published on 7 Days.
The existence of traded agreement in LNG would throw new challenges on Gas exporting nations, as all the process will become transparent in terms of price and opaqueness of market. Presently, two gas markets prevail in world: Henry Hub situated in America, and NBP price of Britain. NBP prices and Henry Hub are frequently conflicting, whereas in Asia and continental Europe the trade of natural gas is shrouded in confidentiality and subjected to continuing supply agreements with destination clauses, which forbids secondary dealing.
All through the 2006, Middle East that has emerged as world’s largest supplier of gas has been major supplier of huge demand from Asian countries. The global trade in LNG is forecasted to touch 261 million tones per annum by 2010 as all the LNG producers are upgrading their export capabilities. Competition among the LNG customer countries to procure gas is expected to be less harsh as LNG production would increase because of expansion of liquefaction capacity.
From the last five years, earlier secluded regional natural gas markets have now become associated to some extent because of the booming of LNG business. LNG shipping has consequently grown to be a major decisive aspect in the extension of worldwide LNG business and key input to the improvement of fresh LNG supplies with the augmentation of the short term LNG marketplace.
As per a research analyst at RNCOS, “In case of emergence of fresh LNG contract, Qatar should be the one acting on it as the largest gas reservoir in world is Qatar’s North Dome field Qatar is projected to export 30 million tons of LNG next year, which is almost one third of the global market, and it has undertaken projects which would double that capacity.”
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