BP Gas and Power is exploring the possibility of sourcing LNG from Oman LNG to supply its UK customers. Oman LNG, which is setting up its third train of LNG at Qalhat in Oman, recently finalised a long-term sales contract for 1.6 million tonnes annually of LNG with Union Fenosa of Spain.

It is now exploring various possibilities to sell the remainder worldwide. The third train has total capacity of 3.3 million tpa.

David Thomas, business development manager of BP in the Global LNG division in UK, said, "The UK market is very important for us as we have been the largest supplier of natural gas in the UK for many years and would like to retain our position there.

"We are looking to co-operate with Oman LNG or Qalhat LNG to supply to the UK as well. BP is just floating the idea. If it compares well with other opportunities that Oman and Qalhat are chasing, then it may work."

Just three weeks ago BP announced plans for an LNG terminal in the UK.

"The UK is like our back yard and the announcement of a new terminal has offered us an opportunity to grow in this market," said Thomas. BP is the biggest gas supplier in the UK and is keen to attain a leading position in the UK LNG market as well, according to the official.

BP is also keen to explore more opportunities in other parts of the globe as well. The US and the European markets are two important destinations for future growth.

The European market has nearly a quarter of global gas demand and is expected to grow further by 2010. European demand for natural gas is expected to go up to 60 million tonnes by 2010 and a quarter of that is likely to be met by LNG.

Among the new emerging markets, India and China are seen as interesting prospects by the suppliers. For BP, Thomas said, "Though there are different challenges involved in LNG supply to these countries, both are quite promising."

In Europe, BP is focussed on Spain, where it supplies 20 per cent of fuels to the industry and also has equal share in the gasoline market.

"We have business interests in the retail market in Spain and also a refinery in Spain, for the group as a whole Spain is a very important market," Thomas said.

"Since we already have a 20 per cent share in fuel and gasoline markets in Spain, we would also like to have an equal share in natural gas."