The liquid natural gas market has long been the domain of the big end of town.
The liquid natural gas market has long been the domain of the big end of town.
However, Perth-based Liquid Natural Gas Limited (LNGLTD) is hoping to change that by tapping into niche markets and discovering reserves that have not been considered viable by major producers.
Since listing on the Australian Stock Exchange on September 14 this year, LNGLTD has signed several agreements for the supply of liquid natural gas.
The most recent was on September 22, when the company signed a Memorandum of Intent with a major Indian industrial group for the 15-year supply of up to 356,000 tonnes per annum of LNG.
The company has had a positive start to listed life with an $8 million capital raising, underwritten by Australian Heritage Group, which closed two weeks early.
LNGLTD has also signed a Memorandum of Intent to supply two existing Indian power plants with 2700 tonnes of LNG a day and 200tpd of gas to India’s major gas transmission and marketing company.
The company has also signed an MOU with Canada’s Artumus, an upstream energy company, for the supply of 220 bcf of gas from a stranded gas field on the coast of Tanzania, Africa.
LNGLTD managing director Maurice Brand said a market niche existed for the company to access smaller, low-cost gas reserves that would otherwise not be developed by companies such as Woodside and British Gas.
Mr Brand said the company planned to deliver the LNG to energy markets that cannot be economically supplied by natural gas pipelines, or are too small for the major LNG suppliers.
The company plans to build modular LNG plants that utilise low-cost stranded gas reserves, that will produce between 100 and 1,000 tonnes per day of LNG.
Larger existing LNG plants typically process 7,000 to 10,000tpd.
“The company has identified a lot of opportunity where cities around the world are starved of natural gas,” Mr Brand said.
“Typically they are in countries that are not heavily populated and that are quite poor, and that tend to use high-cost energy,” he said.
Mr Brand said that while most oil and gas companies look for resources, LNGLTD was on the lookout for market opportunity.
Mr Brand said that LNGLTD could not afford major infrastructure and was looking for opportunities that were closer to existing ports and other infrastructure.
“This has been a conceptual float: We raised $8 million relatively easily because people believed in the idea,” he said.
The LNG market is forecast to double in size by the year 2015 and Mr Brand said that to his knowledge, the company had no competitors in the small end of the global LNG market.
The LNGLTD board includes chairman Phil Harvey (former Alinta CEO), director Richard Beresford (former GM Woodside Energy Ltd), director Bill Hornaday (currently at VP Niko Resources Ltd) managing director Maurice Brand (former managing director of Energy Equity) technical director Paul Bridgewood (formerly of Woodside and Energy Equity) and financial director Norm Marshall (formerly of Portman Mining).
