East Asia may compete with ASEAN for LNG purchase

Japanese liquefied natural gas imports previously had been deeply relied on Southeast Asia. The nation imported more than 70% of LNG from Southeast Asian countries like Indonesia in 1990s, but the dependency is decreasing. Increased spot purchase from the various areas reduces Southeast Asian share in Japanese LNG imports to about 30%. Japan's LNG imports have surged due to the nuclear plants shutdown following the severe earthquake in March 2011. Recently, monthly supply from the Southeast Asia region is sometimes below the imports from the Middle East.

LNG outputs in the Southeast Asia area are expected to increase by about 20% from the current level during the next couple of years due to installing new facilities, according to the International Energy Agency. After that, however, LNG supply in the area is likely to be capped, while the natural gas demand in the region is forecasted to grow steady. Therefore, net LNG exports from Southeast Asia are seen to be declining for the long term.

According to the plans on future LNG development in the area, 5 supply facilities are planned to be build, but the total number of LNG reception facilities that will be constructed are 10. Demand side is twice than the supply side.

The petroleum balance in Southeast Asia is currently net imports by 2 million barrels per day despite the region was the oil supplier previously. Indonesia withdrew from the Organization of Petroleum Exporting Countries in 2009. In the future, the region is expected to be a net consumer of the other energy resources as well.

Forecast on Southeast Asian energy demand by the IEA is based on the prediction about economic growth in the region. The average annual growth of gross domestic products during 1990 and 2011 in the region was 5.0%. It is expected to be 5.5% in 2010s and forecasted to be 4.1% between 2020 and 2035. If more than expected manufacturers move from China into Southeast Asia, the economic growth rate might be changed.

East Asian nations like Japan had relied on LNG supply to Southeast Asia, but the two regions may become to compete for LNG procurements from the North America or the Middle East.