Malaysia’s Petronas has urged producers and consumers of liquefied natural gas (LNG) to collaborate towards growth and sustainability of the industry.
The company’s president and group CEO Wan Zulkiflee 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 canceling 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 at an LNG conference in Tokyo, Japan, he added that Petronas too was forced to not proceed with its proposed LNG project in Canada due to the prolonged depressed prices and unfavorable market conditions.
Recently, Petronas shipped its 10,000th cargo from its Bintulu LNG complex in Malaysia, delivered to Japan on October 4.
Wan Zulkiflee urged all parties to engage in early collaboration to work towards mutually-favorable 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,” he said, adding, “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, according to Wan Zulkiflee.