**Singapore**: Singapore has established Singapore GasCo to centralise gas procurement for the power sector, aiming to ensure supply reliability, reduce market volatility, and support the nation’s transition to net-zero by 2050 through long-term contracts and diversified sourcing.
A new governmental entity, Singapore GasCo, has been launched to centralise the procurement and supply of natural gas within Singapore’s power sector, aimed at ensuring a reliable and economical gas supply. This initiative, announced in a joint statement by the Energy Market Authority (EMA) and Singapore GasCo, intends to harness economies of scale by aggregating demand from various power generation companies to negotiate favourable gas contracts.
The establishment of Singapore GasCo comes as a response to the historical challenges faced by individual generation companies, which were previously responsible for determining their own gas procurement volumes and contract durations. This approach had led to insecurity regarding supply, particularly evident during the global energy crisis of 2021 to 2022. During this period, gas prices surged, prompting many generators to reduce gas procurement, which resulted in significant fluctuations in wholesale electricity prices. An EMA spokesperson noted the necessity of a more coordinated strategy to secure the Republic’s gas needs.
Natural gas currently comprises approximately 95 per cent of Singapore’s electricity generation, sourced primarily from piped supplies from Malaysia and Indonesia, alongside liquefied natural gas (LNG) imported from various nations. The creation of Singapore GasCo is perceived as a critical step in managing this reliance, especially as the country seeks to transition towards net-zero emissions by 2050. According to the joint statement, natural gas is regarded as a cleaner fossil fuel option, producing the least carbon emissions per unit of electricity compared to other fossil energy forms.
Under this new initiative, Singapore GasCo will seek to diversify gas sources and engage in long-term contracts to enhance supply stability and price predictability. This strategic shift aims to allay the apprehensions of generation companies regarding market volatility, thereby encouraging them to commit to longer-term supply agreements.
Alan Heng, appointed as the chief executive officer of Singapore GasCo, brings with him more than 37 years of experience in the energy sector. He previously served as the group CEO of Pavilion Energy until March 2025 and has held various senior roles at ExxonMobil over a span of 23 years, gaining substantial expertise in planning, operations, and marketing within the natural gas domain.
In conclusion, the establishment of Singapore GasCo marks a significant development in the country’s energy landscape, with ambitions to create a stable and efficient power system that meets growing energy demands while supporting the broader transition to sustainable energy practices.
Source: Noah Wire Services
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