Japan and India are among big consumers of liquefied natural gas (LNG) scouring the world for spot cargos and trying to negotiate new supply contracts as competition intensifies in a tightening market.
Despite a boom in the construction of plants to freeze natural gas into LNG, supply is lagging demand, partly because of a drop in exports from major supplier Indonesia, industry executives told a conference on Friday. Shortages of capacity to convert LNG back into normal gas for consumption, and problems with differing gas qualities between regions are also problematic.
"The LNG market is currently a seller's market," Keiji Takemori, General Manager of Energy Resources Development at Japan's second biggest utility Osaka Gas, said.
Osaka Gas Co Ltd supplies about 6.8 million customers in the Kansai Region of western Japan. Its annual LNG purchases total 6.8 million tonnes, roughly five percent of world LNG trade volume.