Ladies and gentlemen,
1. Thank you for your invitation to Gastech 2023.
We have with us today many distinguished guests, including 20 ministers, more than 300 CEOs, as well as thought leaders, economists and policymakers.
2. Gastech was last hosted here in Singapore in 2015.
Since then, many things have changed.
Between 2015 and 2022, trade volumes of LNG have more or less doubled.
There has been strong growth in gas-fired power generation in many countries, as they reduce their reliance on coal.
And we are only just beginning to emerge from a tough energy crisis.
3. But one fact has not changed - the world is undergoing a profound energy transition, getting to net-zero while preserving energy security and economic competitiveness.
In this context, natural gas serves as a reliable source of energy as the cleanest fossil fuel.
It is a vital part of many countries’ energy portfolios, to complement renewable energy sources and contemporaneously support economic development.
4. Up till the 1960s, natural gas was regarded as a by-product of oil extraction without value.
Today, it is a critical and globally traded commodity.
5. Moving forward, the demand for natural gas in Asia will only continue to grow.
a. Gas consumption in the Asia-Pacific region is expected to double to more than 1,600 billion cubic meters by 2050, from 2020 levels.
Southeast Asia is expected to become a net gas importer by 2025 as the natural gas demand exceeds production.
b. In 2023, many long-term LNG purchase agreements were signed, showing the continued importance of LNG in the energy transition.
Both Equinor and ENN Singapore signed long-term LNG sale and purchase agreements of approximately 1.8 million metric tons of LNG each with Cheniere.
Singapore’s strong energy and LNG ecosystem and continued investment in this space
6. Singapore has developed a strong energy and LNG ecosystem over the years.
a. We have established ourselves as a leading LNG trading and bunkering hub in Asia.
i. We have 60 LNG traders operating in Singapore, including the world’s top 10 global energy traders.
ii. In 2022 alone, about US$240 billion worth of LNG trades flowed through Singapore, equivalent in value to about 50% of Singapore’s GDP.
b. We have also built up our LNG infrastructure.
Singapore’s LNG terminal can handle up to 9.6 million tonnes per annum of throughput capacity.
Our upcoming LNG bunkering network will support the growth of LNG as a marine fuel.
c. Other LNG service providers have a strong presence in Singapore as well, strengthening Singapore’s position as the leading financial intermediation and decision-making hub for LNG transactions.
This includes price reporting agencies, ship brokers as well as law firms.
For instance, Platts developed its Japan Korea Marker or JKM LNG price assessment in Singapore.
And today, JKM is widely used globally, especially for contracts in Northeast Asia.
7. Our companies have also innovated to deploy new solutions and create new business models that support the entire LNG ecosystem.
a. For example, in January this year, Seatrium delivered the first of a series of LNG hybrid tugs for use in Singapore’s waters.
The vessel is the first of its kind for operations in Singapore using a pure LNG engine and is supported by an innovative battery power system that allows for emission-free operations during idling and low-speed transit.
Seatrium has commissioned the design and the building of the world’s first LNG hybrid tug in 2018 and continues to build its capabilities to ride the global energy transition.
8. Our investment in the energy and LNG ecosystem has seen promising results.
We are committed to invest further and grow further so that Singapore can better serve the region's energy needs.
a. And we are studying the need to further expand our LNG infrastructure, given domestic electricity demand growth and the regional trade flows of gas.
These ‘hardware’ investments could add significantly to Singapore’s capabilities in the LNG value chain.
b. Now, ladies in gentlemen, we also need to invest in ‘software’.
We want to build a strong core of local LNG trading professionals in Singapore, and as a result of that aspiration, Enterprise SG launched the Leadership Development Initiative for LNG trading.
Chevron and TotalEnergies have onboarded onto the programme.
9. We welcome more global energy traders, including LNG players, to set up their trading operations here and expand their activities in Singapore.
Initiatives to decarbonise the natural gas value chain, with an aim to strengthen LNG’s role as a transition fuel.
10. Ensuring energy security need not be incompatible with our goals to tackle climate change.
And that is why we are also working hard to decarbonise the gas value chain.
11. Today, natural gas releases approximately half of the carbon dioxide and methane emissions when compared to coal.
Decarbonising the LNG supply chain strengthens the value of natural gas as a transition fuel.
12. We have embarked on measures to reduce greenhouse gas emissions, such as upstream flaring mitigation, methane slip reduction, and electrification of production and liquefaction infrastructure.
13. In Singapore, we are committed to achieving net-zero emissions by 2050.
Our thriving energy and LNG ecosystem puts Singapore in a good position to work with global companies, such as yourselves, to support a low carbon future.
a. For example, we are working with industry partners to explore the use of carbon capture, utilisation and storage technologies to reduce the carbon footprint of natural gas.
b. We are also supporting the development of low-carbon and renewable gases, such as hydrogen and biogas.
These can be blended with natural gas to reduce the emissions generated, or be used as alternatives in the future.
EMA, our Energy Market Authority, is proposing to require all new and repowered power generation units to be at least 30% volume hydrogen-compatible, with the ability to be retrofitted to become operationally 100% hydrogen-compatible in the future.
c. SLNG is also studying different potential applications of harnessing the cold energy from LNG regasification.
For example, it is collaborating with Linde Gas to use the cold energy to liquefy carbon dioxide.
If feasible, this could become the first Carbon Dioxide Liquefaction Facility in Singapore and the region, allowing for the capture of carbon dioxide which may otherwise be emitted into the atmosphere.
14. Decarbonisation of the LNG value chain requires a consistent methodology to measure emissions across the fragmented LNG value chain.
I am indeed heartened that the industry has come together to address this pressing issue:
a. EnterpriseSG is working with Chevron and Pavilion Energy to explore the possibility of developing a Singapore Standard for Carbon Accounted LNG.
Riding on existing and on-going work such as the ISO 6338 to calculate greenhouse gas emissions from LNG trades, the proposed standard aims to also cover downstream activities such as power generation and data centres.
15. To conclude, ladies and gentlemen, just like many of us here at Gastech, Singapore takes a pragmatic approach to the energy transition.
We believe in the vital role of natural gas in the global energy ecosystem, especially in Asia.
Without natural gas, it would be challenging for many countries to achieve the dual objectives of energy security and decarbonization.
16. And that is why we have continued to facilitate the growth of the natural gas sector within Singapore, and we encouraged leading international traders to anchor your activities here.
Events such as Gastech, they are important and critical in bringing together countries, companies, and other stakeholders to plan for a net-zero future with a significant role for natural gas.
With this, I wish all of you a fruitful conference ahead.
Speech by 2M Tan See Leng at Gastech 2023 Opening Ceremony
Speech by 2M Tan See Leng at Gastech 2023 Opening Ceremony
Ladies and gentlemen,