India, Japan to develop fair LNG market in Asia
11 Sept 2013 3:25 AM IST
India and Japan, two of the world's biggest buyers of liquefied natural gas (LNG), on Monday agreed to work together for globally competitive price of the fuel in Asia.
The two nations have said that the LNG sold to Asian countries is priced more than the rates at which it is supplied to consumers in Europe and US. In October last year, they had agreed to carry out a joint study to examine ways to mitigate increasing import costs in Asia.
Japan and India have agreed to work together towards the development of LNG markets that will enable effective, stable and globally competitive LNG procurement, said an official statement. The joint statement followed oil minister M Veerappa Moily's meeting with Japan's minister of economy, trade and industry Toshimitsu Motegi in Tokyo on the completion of the joint study on LNG pricing mechanisms in the Asia-Pacific market.
'Forming a transparent and globally competitive liquefied natural gas price in the Asia-Pacific market serves the common interest of Japan and India,' the statement said. 'For both liquefied natural gas producers and consumers, the LNG price should be at a mutually acceptable level.'
Stating that LNG prices in Asia were substantially higher than Europe and US, the two nations said procuring LNG from more diversified suppliers and/or regions will lead to an increase in market connectivity and price convergence among regions, which will result in more competitive pricing of LNG. 'The LNG prices in Asia are substantially higher than those of other major consuming regions such as Europe and North America,' it said.
The two nations noted that since the prices of individual contracts signed on a bilateral basis are confidential, there are no reliable price indices that accurately reflect the LNG supply and demand balance in the region at this point.
The two nations have said that the LNG sold to Asian countries is priced more than the rates at which it is supplied to consumers in Europe and US. In October last year, they had agreed to carry out a joint study to examine ways to mitigate increasing import costs in Asia.
Japan and India have agreed to work together towards the development of LNG markets that will enable effective, stable and globally competitive LNG procurement, said an official statement. The joint statement followed oil minister M Veerappa Moily's meeting with Japan's minister of economy, trade and industry Toshimitsu Motegi in Tokyo on the completion of the joint study on LNG pricing mechanisms in the Asia-Pacific market.
'Forming a transparent and globally competitive liquefied natural gas price in the Asia-Pacific market serves the common interest of Japan and India,' the statement said. 'For both liquefied natural gas producers and consumers, the LNG price should be at a mutually acceptable level.'
Stating that LNG prices in Asia were substantially higher than Europe and US, the two nations said procuring LNG from more diversified suppliers and/or regions will lead to an increase in market connectivity and price convergence among regions, which will result in more competitive pricing of LNG. 'The LNG prices in Asia are substantially higher than those of other major consuming regions such as Europe and North America,' it said.
The two nations noted that since the prices of individual contracts signed on a bilateral basis are confidential, there are no reliable price indices that accurately reflect the LNG supply and demand balance in the region at this point.
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