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Fluctuating LNG costs threaten $50 billion of Asian projects

January 15, 2021


Gas price volatility is threatening gas ventures in the pipeline in several of Asia’s emerging markets, warns a new report by an energy think tank.

The analysis, published on Friday (15 January) by the Institute for Energy Economic and Financial Analysis (IEEFA), shows that planned gas-fired power stations and liquefied natural gas (LNG) import facilities worth US$50 billion face a high risk of cancellation in Bangladesh, Pakistan, and Vietnam as skyrocketing LNG prices hit the region.

For Asia’s utilities, the price spike means their power plants could partly lie idle in the coming year, making gas-fired electricity unaffordable. Erratic prices may be here to stay, and this could see many new projects become unbankable, calling ambitious gas development plans into question, stated the report.

Bruce Robertson, IEEFA energy finance analyst and author of the analysis, said price volatility had already led Bangladesh and Pakistan to call off several tenders for LNG deliveries at the end of 2020, with more cancellations expected to follow.

[Tim Ha]

More: Volatile prices put US$50b of gas projects in Asia at risk, report warns

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