Asia's demand for natural gas to generate electricity is set to rise this summer as leading buyer South Korea joins Japan in snapping up cargoes of the fuel to plug a power shortfall after more nuclear reactors were shut over safety concerns. Seoul has warned of power shortages and rolling blackouts due to the closure of two reactors and the extended shutdown of a third to replace parts supplied using fake documents.
Traders and suppliers of LNG, gas super chilled into liquid for shipping, see the extra South Korean demand boosting prices already being supported by additional Japanese needs after the Fukushima crisis two years ago crippled its nuclear industry. South Korea, the world's No 2 liquefied natural gas importer after Japan, is due to detail its plans on Friday on how it intends to cope with a loss of power just as demand peaks in the summer when air conditioning use spikes. Meteorologists are forecasting this summer could be unusually hot.
Korea Gas Corp (KOGAS), the world's largest corporate buyer of LNG, has already said it will raise stock levels to 70 percent of its capacity of 3.96 million tonnes from about 60 percent now. That will mean an additional requirement of 396,000 tonnes of LNG, which is mainly supplied in Asia by plants in Australia and Indonesia.
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