Singapore govt to manage gas purchases, supply for power sector -minister
SINGAPORE, Oct 23 (Reuters) - The Singapore government said on Monday it will create an entity in 2024 to centrally purchase and manage natural gas supply for the power sector as it seeks to boost its energy security.
The city state relies on gas to generate 95% of its electricity. This is the latest among several pre-emptive measures taken by the government to safeguard the country's energy security after surging global gas prices roiled the city-state's electricity market in recent years.
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"Moving forward, we will take a more deliberate and oriented approach to gas procurement," Minister for Trade and Industry Gan Kim Yong said at a conference during Singapore International Energy Week.
"This will create greater economies of scale and allow us to negotiate more favourable gas-contracting terms, procure gas from diverse sources to reduce concentration risk, and enter into longer term gas contracts to provide more stable prices and supplies," Gan said.
The Ministry of Trade and Industry and the Energy Market Authority (EMA) will create the entity, to be known as Gasco, in 2024 to aggregate gas demand from power generators and purchase additional volumes when electricity demand exceeds expectations, EMA said in a statement.
This will apply to all future gas demand from the power sector, including gas contract renewals, it said.
A surge in global gas prices in 2021 created volatility in wholesale electricity markets and forced several power retailers in Singapore to exit.
Separately, EMA and the Maritime and Port Authority of Singapore (MPA) has also short-listed six consortia to develop a low- or zero-carbon ammonia project to generate power and for ship bunkering on Jurong Island, Gan said.
The proposals from the six consortia will go into a closed request-for-proposal (RFP) stage that will be launched before the end of 2023, and then a lead developer will be selected to jointly develop the project with the government, EMA said in a statement.
The project will generate 55 to 65 megawatt (MW) of electricity from imported low- or zero-carbon ammonia, via direct combustion in a gas turbine or combined cycle gas turbine, EMA said.
The project will also facilitate ammonia bunkering at a capacity of at least 100,000 metric tons per year, starting with supplies from land followed by ship-to-ship bunkering, it added.
Singapore is also building up its expertise to understand advanced nuclear technologies such as small modular reactors, Gan said. (Reporting by Jeslyn Lerh, Emily Chow and Florence Tan; Editing by Christopher Cushing and Tom Hogue and Miral Fahmy)