Singapore to centralise gas procurement to ensure stable supply

A new entity, Gasco, will lead the procurement of gas supply.

Singapore’s Ministry of Trade and Industry and the Energy Market Authority has revised the country’s procurement framework for the power sector and will implement a centralised procurement system by 2024 to ensure the stability and reliability of the gas supply.

The current framework relies on the individual power generation companies' (gencos) procurement strategies wherein they decide the volume and tenure of gas to procure based on their own needs.

The government said the current framework does not assure that the country will have sufficient gas supply to meet its needs.

“Having a secure and reliable supply of natural gas is existential for us as 95% of our electricity is generated by natural gas,” Minister Gan Kim Yong said at the Singapore International Energy Week.

“As the global gas market conditions are expected to be more volatile in the energy transition, we need to rethink our approach to gas procurement,” he added.

The government will establish Gasco which will oversee the centralisation of the procurement and supply of gas for the power sector.

The entity will collate demand from the gencos. Gasco can also secure additional gas volumes if it sees the demand exceeding the indicated supply needed by gencos.

ALSO READ: EMA seeks proposal for 600 MW combined cycle gas-turbine project

“When implemented, this centralised procurement approach will apply to all future gas demand from the power sector, including gas contract renewals. Gencos will be allowed to continue with the existing gas supply contracts they have with their respective gas suppliers,” the MTI and EMA said.

“Other industrial gas customers can continue to procure gas through licensed gas importers and will not be subject to this central procurement framework,” they added.

The government added that Gasco will have a “stronger negotiating lever” and will be in a better position to negotiate more favourable contracts to optimise needs.

Gasco can also lead in procuring gas from diversified sources to reduce concentration risks and can enter into longer-term gas contracts which can help ensure a more stable supply and price.

Follow the link for more news on

Energy Market Authority

A NOTE FROM SINGAPORE BUSINESS REVIEW

The people you want to reach are already in this room.

Every quarter, SBR lands on the desks of the founders, CFOs, and directors running Asia's most consequential companies. Every day, they open our newsletter and read our website. It's a room that took twenty years to build — and it's the one most of our partners are trying to get into.

The good news is that the door is open. We work with companies on thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. The shape of the right partnership depends on what you're trying to do, which is why we'd rather start with a conversation than send a rate card.

If you have something this room should know about, tell us. We'll tell you honestly whether we can help, and how.

No rate cards until we understand the brief. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia