Commodities shipper BW Group and Singapore's Pavilion Energy have agreed to form a joint venture to manage, acquire and charter liquefied natural gas (LNG) shipping assets, the companies said on Friday.
"The partnership with BW Group represents our expansion into LNG shipping, and an investment into a critical part of the LNG value chain which enables Pavilion Energy to effectively connect global LNG supplies to regional gas demand centers in Asia," Pavilion Energy group CEO Seah Moon Ming said.
Japan, India, South Korea and other Asian gas importers take up about 70 percent of global LNG exports, with China's imports of the super-chilled fuel growing at a record pace as it aims to use cleaner fuels to cut smog in big cities.
China could overtake South Korea to become the world's second-biggest LNG buyer - behind Japan - importing 61 million tonnes of LNG by 2020 from 18 million tonnes last year, said consultancy Wood Mackenzie in a recent forecast.
The new venture, BW Pavilion LNG Pte Ltd will operate one existing and two new LNG carriers, the venture companies said in a statement.
BW Group specializes in oil and gas transportation and has a fleet of 113 vessels, including LNG carriers, according to the statement.
Pavilion Energy was set up in April 2013 by Temasek Holdings , Singapore's sovereign wealth fund, and is focused on LNG investment. The firm has a committed capital of $6.9 billion, according to the company.
Singapore aims to position itself as an LNG trading hub for Asia as it is located between producers such as Indonesia, Malaysia and Australia, and countries with growing demand such as China, India and Thailand.
Copyright Reuters 2014.