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Petronas calls for greater collaboration towards a sustainable LNG market

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LNG Industry,

Petronas has urged producers and consumers of LNG to collaborate towards encouraging the growth and sustainability of the industry.

Petronas has urged producers and consumers of LNG to collaborate towards encouraging the growth and sustainability of the industry.

Its President and Group CEO Wan Zulkiflee bin Wan Ariffin warned that while demand for LNG has grown, there is a possibility of industry stagnation if LNG prices do not encourage necessary investments to sustain the business.

“Today, players are cancelling and delaying projects in tandem with the LNG prices. Without sufficient investments, both buyers and sellers face an uncertain future in terms of business sustainability and energy security,” he said.

Speaking to the audience of the LNG Producer-Consumer Conference 2017 in Tokyo, Japan, he said that Petronas too was forced to not proceed with its proposed LNG project in Canada due to the prolonged depressed prices and unfavourable market conditions.

Nevertheless, he acknowledged that the current market dynamics have stimulated internal efficiency improvements that have provided Petronas with better agility as an integrated end-to-end LNG player to accelerate growth once the industry is on an upturn.

“With deeper resource pools, we are able to invest in people, technology and innovation to provide energy solutions that go beyond just selling and delivering LNG. Through these investments, we aspire to help create a more sustainable LNG market that is able to fuel the world’s economies,” he said.

Wan Zulkiflee urged all parties to engage in early collaboration to work towards mutually-favourable market conditions to encourage investments for business longevity and long-term supply stability.

“While current market dynamics are not encouraging conversations about sustainable gas pricing, it is in our interest, both as sellers and as buyers to bring this up.

“Although buyers’ considerations remain in our best interests, the current market volatility necessitates the security of demand. This is imperative for the producers to continue investing to support the upstream and LNG value chain in a timely manner,” he concluded.

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