Source says market players tested IT system thoroughly
Ronnie Lim, Business Times 8 Sep 08;
(SINGAPORE) Sept 15 - this is when Singapore will liberalise or completely free up its gas market.
This means that all natural gas - whether piped from Malaysia and Indonesia or shipped via LNG tankers from elsewhere - will be intermingled and transported via a PowerGas-owned and managed inland gas pipeline network to all end-users such as power stations and petrochemical plants here.
'Everything has been tested and it's all systems go for a Sept 15 launch,' a source told BT, adding that there may still be a bit more fine-tuning even then - after players' feedback of the Gas Transportation System Solution (GTSS) or IT operating system developed by Singapore Power subsidiary PowerGas.
Market authorities such as regulator Energy Market Authority (EMA) want to ensure a 'bug-free' GTSS from Day 1 - which meant comprehensive and exhaustive testing of the IT system with all the market players involved - and that was a reason why the gas market opening was postponed from the earlier July 1 target to the mid-September date.
Liberalisation of the gas market - following that of the electricity market in January 2003 - is important as natural gas accounts for over 80 per cent of electricity-generating feedstock. Open competition in gas supplies is aimed at keeping prices down.
Under a liberalised gas market there will be licensed gas 'shippers' including Gas Supply Pte Ltd and Sembcorp (both Indonesian gas buyers), Keppel Corp and Senoko Power (which buy Malaysian gas) and PowerSeraya, which wants to be a gas trader as part of its plans to be an integrated energy player.
But there will only be one 'transporter', PowerGas, which is in charge of the inland gas pipeline grid.
There will also be 'importers' - which includes some of the shippers - which deal directly with the gas producers to source for the gas. UK's BG Group, appointed the aggregator or sole buyer of liquefied natural gas for Singapore earlier this year, will be one such importer.
Ahead of the Sept 15 market launch, SembCorp Gas is expected to have transferred its onshore gas pipeline assets to PowerGas and have been compensated for exiting the gas transportation business.
Field trials for the GTSS started in early June, which was also the time when PowerGas advertised for personnel to administer and manage the gas market operations, as well as technical officers and technicians to maintain the system.
To prepare for the market opening, the government also implemented an amended Gas Act in February which facilitates open, competitive access for gas importers and retailers to Singapore's pipeline grid and the upcoming LNG terminal.
Despite the impending gas market opening this month, one player still left out in the cold is Island Power.
Island has had to suspend its $1 billion power station project on Jurong Island as it has been unable to bring in its own Indonesian gas supplies because of legal pipeline tangles involving incumbent Singapore players.
It had filed an application to the EMA last year to help it resolve this and gain access to the pipeline.
Last month, an EMA spokeswoman told BT that while 'the Gas Network Code (or market opening here) will give Island Power access to the onshore pipelines, the work to open access to the offshore pipelines for Island Power is still in progress'.
