Spot prices for LNG in Asia are on the rise following a flurry of demand from South Korea and top exporter Indonesia in the face of tight global supplies.

Record-high oil prices are also helping to bolster spot premiums for cargoes of the super-cooled, compressed gas.
“It will depend on whether cargoes have to be redirected from elsewhere or how tight shipping is at the time, but the (spot) premium could be upward of $1 per million Btu so we could easily see them pay $6 per million Btu,” said Jeff Brown, chief economist at Hawaii-based energy consultancy, FACTS Inc.
Last year, buyers of spot LNG were paying a premium of around 50-80 cents per million British thermal units.
Production problems and higher domestic demand for gas in Indonesia are forcing the world’s biggest LNG exporter to turn to rival suppliers. Some analysts estimate Indonesia may need up to 30 cargoes to meet its sales commitments this year.
Korea Gas Corp (Kogas) , the world’s single biggest LNG buyer, is still seeking spot cargoes despite issuing a tender this month for 1.5 million tonnes annually from October through March 2008.
“It is true that we still need spot cargoes regardless of the short-term LNG contract which is being sought,” a Kogas official said.
The state-run company said in June it was seeking at least 20 parcels for winter demand, roughly equivalent to 1.2 million tonnes and about six percent of South Korea’s expected 2004 gas consumption. The official declined to say how many of those spot cargoes it still needed.
Kogas tender - Page 3