APEC EGCFE Workshop APEC EGCFE Workshop March 21-23, 2005March 21-23, 2005

The Grand Hotel, Chinese TaipeiThe Grand Hotel, Chinese Taipei

Cooperation & Competition Cooperation & Competition in Asia-Pacific LNG Marketin Asia-Pacific LNG Market

Dr. Boyoung KIMKOGAS

2

Yesterday Nowadays Tomorrow

in Asia-Pacific LNG Market

CONTENTS

3

76.65

10.9338.31

10.05

22.74

5.36

48.3

12.36

20.0730.59

8.2

3.7

Source : bp Source : bp

World NG consumption: 2.08b ton International Trade 510m ton

(25 % of total consumption) Trade by Pipeline NG : 370m ton Trade by LNG : 140m ton - Japan : 60.0m ton (43%) - Korea : 19.0m ton (14%)

in 2003

World Natural Gas Trade

4

World LNG Trades

5

1st rush hour

2nd rush hour

Source : Clarkson Research Studies

When the 3rd Rush hour of LNG consumption will be ?

Coming-up the New Era in LNG Market

when?

1,00

0㎥

ship

s

6

The Restriction of Expanding LNG Market

40.0

46.0 MJ/nm3

43.0

Om

an (45.4)

Abu

Dh

abi (44.6)

Qatar (44.3)

Malaysia (44.7)

Au

stralia (44.4)

Indon

esia (43.9)

Algeria (41.8)

Trin

idad & T

(40.8)

Alaska (40.2)

Middle-East AsiaMiddle-East Asia South-East Asia South-East Asia

LNG Quality High Calorie

Low Calorie

Africa & AmericaAfrica & America

Nigeria (43.9)

7

2000 2005 E 2010 E 2015 E

Japan 53.4 58.3 67.8 75.6

Korea 15.0 25.2 38.1 48.4

Taiwan 4.3 5.9 9.0 13.5

India - 2.0 10.5 16.0

China - - 7.1 13.0

Asia (total)Asia (total) 72.7(71.4%)72.7(71.4%) 95.6(63.7%)95.6(63.7%) 132.5(48.9%)132.5(48.9%) 166.5(44.7%)166.5(44.7%)

France 9.0 8.8 11.8 14.0

Spain 6.9 15.5 18.8 35.2

U.K - 2.6 19.9 27.2

Europe (total)Europe (total) 23.9(23.5%)23.9(23.5%) 37.9(25.3%)37.9(25.3%) 72.7(26.9%)72.7(26.9%) 103.0(27.7%)103.0(27.7%)

US East Coast 4.9 15.0 45.0 70.0

US West Coast - - 5.0 10.0

Mexico - - 11.3 15.8

America (total)America (total) 5.1(5.0%)5.1(5.0%) 16.5(11.0%)16.5(11.0%) 65.5(24.2%)65.5(24.2%) 103.0(27.7%)103.0(27.7%)

TOTALTOTAL 101.8(100%)101.8(100%) 150.0(100%)150.0(100%) 270.6(100%)270.6(100%) 372.5(100%)372.5(100%)

World LNG Demand : Forecasting

Unit : mtpa

Source : LNG Global 2004, Deutsch Bank

8

2000yr 2000yr2000yr2010yr 2010yr2010yr

23.9

72.772.7

132.5

5.1

65.5

Unit : mtpa

Europe Asia America

World LNG Demand : Forecasting (cont.)

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- Consumers : Japan, Korea, Chinese Taipei U.S.A, EU (Spain, France, Italy, U.K)- Producers : Indonesia, Malaysia Qatar, Algeria, Australia, Russia (The Far East)

Perspectives of the great Shifting in LNG market

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Tsunami in Asia-Pacific LNG market

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LNG Demand  1990 1995 2000 2004E 2005E 2006E 2007E 2010E 2015E04-07

CAGR

USA 1.7 0.4 4.9 12.7 15.0 18.7 27.7 50.0 80.0 30%

JAPAN 32.4 43.5 53.4 57.7 58.3 60.2 62.1 67.8 75.6 2%

Chinese Taipei 0.7 2.5 4.3 5.9 6.4 6.9 7.4 9.0 13.5 8%

KOREA 2.1 7.1 15.0 20.2 25.2 27.8 30.4 38.1 48.4 15%

Source : LNG Global 2004, Deutsch Bank North America ; R/P=9.7

LNG Demand : US, Japan, Chinese Taipei and Korea

0

10

20

30

40

50

60

70

80

1990 1995 2000 2004E 2005E 2006E 2007E 2010E 2015E

USA JAPAN Chinese Taipei KOREA

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US ; The Master plan of LNG Terminals

The seismic center of Tsunami in Asia-Pacific LNG Market

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Source : The future relationship between LNG pricing in the Asia-Pacific and the Atlantic-Mediterranean, PFC Energy

Average

$5.28/mmBTu

Average

$6.00/mmBTu

The price gap ; US East Coast vs. US West Coast

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Source : Poten & partners, LNG in World Markets

Volumes of spot LNG and NYMEX gas price

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The price gap ; Henry Hub vs. LNG into Japan

Source : The future relationship between LNG pricing

In the Asia-Pacific and the Atlantic-Mediterranean,

PFC Energy

$9.13 $7.42

16

Source : Han Wonhee, Quarterly Review of Gas Economics & Management (KOGAS)

“Market share of LNG Spot Trade”

Trend : The Market share of LNG spot trade

17

4.6mtpa

0 mtpa

17.8mtpa

53.9 mtpa 50mtpa

7.1 mtpa

38.1mtpa

67.8 mtpaChina’s Total consumption of China’s Total consumption of

NG will be 85mtpa in 2010NG will be 85mtpa in 2010 USA’s Total Consumption ofUSA’s Total Consumption ofNG will be 550mtpa in 2010NG will be 550mtpa in 2010

LNG consumption in 2002

LNG consumption in 2010

0 mtpa

11.3mtpa

The Future of Asia-Pacific LNG market

Tsunami

5.3 mtpa

9.0 mtpa

Winter SeasonWinter Season

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Relationship among Asia-Pacific Economies

Cooperation & Competition

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Tel : +82-31-710-0840 e-mail : kimby@kogas.or.kr

Thank YouThank You