Southeast Asia's Gas Expansion Tests Assumptions Amid Middle East Chaos

Countries in Southeast Asia are forging ahead with plans to build natural gas-fired power plants despite the recent shock of higher liquefied natural gas (LNG) prices caused by the Middle East war.

The region is also constructing more LNG import capacity, according to a report from Global Energy Monitor. The think tank found that there's some 100 GW in new gas-fired power generation capacity under construction across Southeast Asia and 70 GW in LNG import capacity.

'The continued expansion of LNG import infrastructure risks deepening exposure to the same supply disruptions and price volatility the crisis has brought to the fore,' Global Energy Monitor said. The think tank noted that Southeast Asia could boost its domestic natural gas production to reduce dependence on imported liquefied gas but warned that this would take time.

GEM identified at least 20 fields that could add around 62 billion cubic meters per year of production capacity by 2035, but new supply takes years to develop and may not even supply domestic power markets.