MGA holds 3^rd Virtual Industry Talk on How Should Malaysian Market Players Respond to the Changing Global LNG Market Dynamic?

Held on 16^th June 2020, MGA’s  3^rd Industry Talk was attended by MGA members from over 40 organisations. The virtual talk or webinar , held in collaboration with Wood Mackenzie, a member of MGA, discussed the topic on How Should Malaysian Market Players Respond to the Changing Global LNG Market Dynamic. The session that lasted about one hour also provided the audiences with opportunity to participate in the Q&A.

The event, introduced by Jenna Lim from Wood Mackenzie, started with an Opening Remarks from Hazli Sham Kassim, President of MGA. This is then followed by the main speaker, Mangesh Patankar, Director, Gas and LNG Consulting, Wood Mackenzie, who spoke on how Malaysian market players should respond to the changing global LNG market dynamics.

Key takeaways from his presentation includes;

• Gas/LNG markets have been impacted by Covid-19 pandemic and the fall in oil prices. The lockdowns have reduced demand, whilst oil price has had varied impacts. Longer term recessionary implications bring further uncertainty.
• Maintenance deferrals have increased immediate supply availability but project delays will negatively impact annual 2020-27 supply.
• The global LNG supply demand outlook indicates that supply from new pre FID projects is not required until at least 2024-2025. Furthermore, there are already immense upstream gas resources globally (including in Malaysia) available to feed future incremental LNG demand. The Upstream East Malaysian assets will be competing against global low cost upstream resources.
• As Peninsular Malaysia’s domestic gas supply and pipeline imports decline, there will be an increasing need for LNG imports, which will in turn increasingly link domestic gas prices to regional oil indexed LNG prices. Gas market liberalisation means prices will be driven by the marginal supply source (i.e. LNG); regional LNG prices will act as a benchmark for domestic gas prices.
• Aspirations for Gas hubs are progressing in ASEAN but a number of factors will need to be addressed before any can take off.

During the Q&A session, a total of 21 questions were posted by the audience. Unfortunately, time permitted only a few questions to be addressed live by Mangesh.

From a survey carried out after the event, 60% of the survey respondents found this webinar informative. Given the overwhelming response from members, MGA should organise more online webinars with interesting topics in engaging and providing industry updates to the members.