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  • Sep 6, 2006
    Liquefied natural gas is at best an interim measure
    I REFER to Ms Choo Wai Chan's letter, 'Alternative fuels won't fully replace fossil ones' (ST, Sept 1). Complementing PNG (piped natural gas) with LNG (liquefied natural gas) is not that much of a diversification. It is the path of least resistance since the existing power plants do not need to be replaced.

    It is not a diversification because it is the same fossil fuel, just more expensive, due to the need to freeze it before shipping it and also having to re-gasify it before it can be used. The cost of the LNG infrastructure - terminal and tankers - is in the billion-dollar range, and guess who foots the bill eventually? Besides, we still have to contend with resource depletion. With LNG, we may 'run away' from local resource depletion in Malaysia and Indonesia but nobody can run away from global depletion. The gamble the Government is taking is that global depletion arrives later than local depletion. As for global depletion, the figure of 40 years of reserves left is often quoted but that is misleading. It implies that problems will only occur in the far future but that may not be true. The problem is not running out, the problem is hitting the halfway point, known as Peak Oil (and Peak Gas), where global production starts to decline and can no longer keep up with demand, causing prices to rise dramatically. According to geologist Dr Colin Campbell of the Association for the Study of Peak Oil and Gas, the peak date is due to arrive by 2010. That is two years before Singapore's LNG terminal is even scheduled to start operations.

    The Singapore Government deserves credit for pushing ahead with the LNG initiative, though it is hardly an original idea - many countries are also setting up LNG terminals. America is planning 40 terminals. Even Mexico, home to the world's second largest oilfield, has started importing LNG. This tells us something about the sheer level of demand that will be coming up for LNG in the coming years. Singapore is joining a race that has already started.

    LNG will be traded just like crude oil is today. Qatar is setting up an energy trading exchange. The natural gas will, quite naturally, go to the highest bidders. What is quite certain is, at the end point, it is not going to get any cheaper. There is nothing cheap about LNG. It is at best an interim measure while society considers other solutions. Although the other alternatives for base-load electrical power - nuclear, coal, geothermal, ocean tidal and thermal - are fraught with all kinds of environmental, political and technical risks, they need to be considered well before the global peak date arrives. While making preparations for the LNG terminal, the Government should also take a close look into alternative energy sources - while there is still time.

    Low Ee Mien

 

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