How do new buyers buy LNG in Cambodia?

New buyers like Cambodia typically acquire LNG in two ways. LNG can be purchased from spot markets or through multi-year contracts, which establish volumes and pricing methods over the contract term. Each option entails various risks for energy security and cost that are critical for Cambodia.

Why is Cambodia struggling to access affordable LNG supplies?

Other countries in the region, reliant on LNG imports, have seen global market disruptions impair energy security and affordability. As a potential new market entrant with limited bargaining power, uncertain gas requirements, and a lower demand profile, Cambodia could struggle to access affordable LNG supplies.

Should Cambodia scale its LNG project aspirations?

Cambodia must scale its LNG project aspirations so that LNG-fired power does not put the government’s energy goals out of reach. Doing so would allow stakeholders to pursue LNG contracts and infrastructure plans that are best-suited to deliver Cambodia’s energy objectives.

Should Cambodia integrate a 900 MW liquefied natural gas power plant?

Cambodia's plan to integrate a 900-megawatt (MW) liquefied natural gas (LNG)-fired power plant into its electricity system is a risky proposal. Other countries in the region, reliant on LNG imports, have seen global market disruptions impair energy security and affordability.

Will Cambodia pay a penalty for using LNG?

Since LNG’s role in the Cambodian energy system is still uncertain, the country could find itself paying significant penalties. Importantly, LNG is likely to be expensive under both approaches. Prices under both spot and contract arrangements are currently two to three times as high as coal.

What are Cambodia's energy goals?

Cambodia’s energy objectives include maintaining an affordable power supply and generating 70% of the country’s power from renewable sources by 2030, up from 50% in 2023. Cambodia must scale its LNG aspirations so that LNG-fired power does not derail the achievement of these goals.