Singapore's Gas Demand to Remain Strong Amid Decarbonization Efforts and Infrastructure Expansion

Singapore's energy landscape is poised for significant transformation as it navigates growing demand for gas, particularly from the power and bunkering sectors. At the recent APPEC 2025 event, Leong Wei Hung, CEO of Singapore LNG, emphasized the importance of energy security for the nation, stating, "We are a growing nation that attracts numerous investors, and our citizens expect a reliable energy supply."

With expectations of heightened power demand, Leong highlighted the necessity for a shift towards cleaner energy alternatives, such as LNG, as part of broader decarbonization efforts. Singapore is already advancing its infrastructure to meet these needs, with plans for a second LNG terminal featuring a floating storage and regasification unit capable of processing 5 million metric tons per year. This facility is anticipated to enhance the country's energy security and potentially serve other applications, such as bunkering, once its primary objectives are met.

Leong predicts substantial growth in the LNG sector over the coming years, particularly within bunkering, as the global demand for LNG-fueled ships rises. In 2024, Singapore solidified its status as the world's largest bunkering port, recording marine fuel sales of 54.92 million metric tons, a 6% increase from the previous year. Notably, LNG bunker volumes surged more than fourfold to exceed 460,000 metric tons year-on-year.

While 90% of gas is currently directed towards power generation, Leong indicated that the emerging focus on alternative fuels, including ammonia, reflects a changing landscape in energy consumption. He expressed confidence in Singapore's unique position within the global trade flow, despite growing competition from China in the bunkering arena.

In August, Singapore LNG further underscored its commitment to diversifying LNG distribution by constructing a new truck loading facility on Jurong Island. This facility is designed to support users beyond the island, addressing the broader demand across the country.

The recent establishment of Singapore Gasco, a government-owned entity aimed at centralizing gas procurement and supply for the power sector, marks a significant step towards ensuring stable energy pricing and availability. Leong acknowledged that while the Gasco model may not suit every market, it represents a viable approach for enhancing energy stability and fostering long-term procurement strategies.

As Singapore continues to evolve as a key trading hub for LNG, its focus on energy security, infrastructure development, and sustainable alternatives positions the country at the forefront of the energy transition in Southeast Asia.