Optimistic on Asia: Shell's Kathleen Eisbrenner
'Recession LNG prices tempt Asia'
Petrochina is set to become Shell’s largest liquefied natural gas customer, as recession-hit gas prices are spurring increased interest in long-term contracts from emerging countries.
"The financial crisis is changing Asia's interest in long-term contracts," vice president of Shell’s Global LNG Kathleen Eisbrenner told a conference in Oslo.
Two or three years ago, Asia was not really in the market to buy LNG, and if countries did buy they only bought when prices were very low, she said.
She added that in the future "Petrochina will be Shell’s largest LNG customer".
Eisbrenner said that, looking ahead, both China and India are huge potential areas for the LNG market.
As economies grow their energy consumption increases, Eisbrenner said, adding that the large populations of both China and India make them huge potential markets.
She added that India had recently set up a central agency to boost gas penetration in the country.
Today there are 10 cities in India with a natural gas distribution, the role of the agency is to increase this to 150 cities by 2015 and over 200 by 2020.
“If they are successful, India will go from having a natural gas penetration rate of 0.3% to 40%,” said Eisbrenner.
“We believe that within a decade that is possible.”
Last year, Shell signed two major contracts with Petrochina, making it the largest supplier of LNG to the country.
The first contract was for 3 million tonnes of LNG for 25 years from the Shell’s Qatargas 4 project and the second for two million tonnes of LNG per annum for 20 years.