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The Asian gas market: is there room for Russia?

The Asian gas market: is there room for Russia?

Having political difficulties in relations with the European Union Russia has to think about diversification of its gas exports.

An important step towards the East was made in 2014 when a contract on natural gas supplies to China along the eastern route was finally sealed. However, political reasons are not the only factor in favor of this contract. The focus of the world economic growth shifted to Asia long ago. Meanwhile, natural gas consumption in this region is noticeably below the level of the developed western countries.

Until recently LNG was in fact the only instrument of gas delivery to Asia Pacific markets, while piped gas supplies popular in the rest of the world practically were not developing.

Over the past few years the Chinese natural gas market has been focused on imported resources. The construction of the transportation infrastructure and formation of the financially capable demand have been developing at a high pace creating opportunities for Russia and strengthening the need for a world level piped gas supplier.

Japan and South Korea that account for a half of the world demand for LNG are also interested in diversification of supplies through engagement with the gas-rich neighbor. Moreover, the LNG market is undergoing transformation drifting from rigid obligations to a more flexible system, which, in its turn, creates risks of security of supplies.

India and Pakistan are eagerly looking for resources to fight energy poverty and simultaneously increase the living standards and economic growth.

The new report analyzes main tendencies on Asian gas markets, prospects of the demand development, sources to cover the growing demand, opportunities and risks for Russia.

Key topics of the report:

  • Parameters of main markets of natural gas in Asia

    • Development of the gas market in China – the locomotive of the world’s economic growth
    • The demand in Japan and South Korea – do they have a market for new gas?
    • Prospects of natural gas in Hindustan
  • Liquefied natural gas on Asian markets

    • Problems of contracting and pricing
    • Selecting between reliability of supplies and spot volatility
  • Russian gas projects aimed at Asian markets

    • The pace of the Power of Siberia implementation
    • Prospects of a western gas pipeline to China
    • Russian LNG projects
  • Medium-term forecast

    • Russia’s competitiveness on Asian markets

Contents of the report:

Introduction 3
Chapter 1. China — the locomotive of gas demand growth in Asia 4
1.1. Role of natural gas in China’s energy balance. Structure of natural gas consumption 5
1.2. Natural gas production 9
1.3. Sources of gas imports 13
1.4. Gas pricing in China 16
1.5. Prospects and risks of gas market development in China 18
Chapter 2. Gas markets of Japan, S. Korea and India 21
2.1. Japan 21
2.2. The Republic of Korea 27
2.3. India 31
Chapter 3. LNG in Asia Pacific: long-term relations or spot volatility 33
3.1. Tendencies in the world LNG market 34
3.2. LNG markets in Asia 39
3.3. Prices collapse, prospects of new LNG capacities 43
Chapter 4. Russian projects for Asia, main piped gas competitors 48
4.1. Power of Siberia, other pipeline projects in the East 48
4.2 Altai project, connecting China to Western Siberia 53
4.3. Turkmen gas for China 54
4.4. TAPI project 56
Chapter 5. Forecast of developments 59
Date of release: May 12, 2015

If you are interested to obtain please contact » Elena Kim

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