LNG

South Korea offers Sri Lanka ‘free’ LNG terminal

SK E&S is offering Sri Lanka an LNG terminal for free as long as it signs up to a 20-year sales-and-purchase agreement SK E&S is offering Sri Lanka an LNG terminal for free as long as it signs up to a 20-year sales-and-purchase agreement.
By The Wildcat 18 January 2018 0 29166
The Höegh Grace FSRU The SK E&S project would involve installing an FSRU. (Höegh)

South Korea’s SK E&S, a state-backed gas and power company, has offered to build a floating LNG terminal in Sri Lanka ‘free of charge’, adopting a loss-leading pricing strategy more familiar to the mobile phone market. 

The strategy involves selling something at a loss or, in this case, offering it for free to stimulate sales of more profitable goods – such as a long-term LNG sales agreement. Given that the cost of LNG import infrastructure is cited by analysts as a major barrier to...