Asia/Pacific News
Japan, India Mulling LNG Pricing Shift
Japan and India have launched a joint research project to determine whether Asia is paying more than it should for liquefied natural gas (LNG), the AFP reports.
The price of LNG in Asia is much higher than in North America because the Asian price is index-linked to the price of oil, while the North American price is based on supply and demand.
Japan is the world's top importer of LNG, and analysts are predicting its consumption is likely to grow as it is backs away from nuclear energy in the wake of last year's Fukushima disaster following the Tōhoku earthquake and tsunami.
India is also growing its energy use as its economy expands.
Development of shale gas in North America has driven down the price of gas on the continent and increased energy companies' interest in the fuel.
If Asia were to shift to a market-based pricing mechanism for pricing LNG, it could have a major impact on exports of the fuel from North American projects including planned projects in Canada, according to Alberta Oil.
