Short-term or spot trading in liquefied natural gas will expand to account for 20 percent of the market by 2012, driven by scarcity, price fluctuations and unexpected changes in demand, consultants Poten & Partners said.

Trading of one-off cargoes not covered by long-term contracts will probably grow by more than 10 percent a year, Daryl Houghton, a consultant at the U.S. firm, said today in Darwin. The proportion will rise from 13 percent of the LNG market at present and just 2 percent in 2000. While Trinidad and Egypt are the biggest providers of spot cargoes, Qatar will play an increasing role, he said.

LNG, natural gas chilled to liquid form for transportation by tanker, is being traded between an increasing number of producing and importing countries as it captures a greater share of the total gas market. Spot trades accounting for about 24 million metric tons of LNG took place last year, out of a total 180 million tons, Houghton said.

``The short-term market now fulfils a need for industry flexibility and short-term cargoes now go to buyers that have the greatest need,'' he said. ``The industry is changing the market.''

Spot LNG trades may reach 36 million tons this year, rising to 56 million by 2012, Houghton estimates.

The increasing unreliability of LNG production plants is helping stoke spot market trading, Houghton said. The ``very poor'' production performance of StatoilHydro ASA's Snohvit LNG plant in the Arctic, for example, demonstrates the importance of the spot market to meet demand, he said.

Asia has taken over as the major buyer of spot cargoes since 2006 because of a ``genuine shortage'' of long-term supplies and a lack of pipeline supplies, Houghton said. ``Almost no volumes'' are going into the U.S. this year because Henry Hub prices are so far below Asian prices, he said.

Spot sales from the Atlantic Basin into Asia could reach 6.5 million tons this year, mostly to Japan and South Korea, Houghton said. In the medium-term, spot sales into Asia should decline as the start-up of plants such as the North West Shelf LNG venture's fifth production unit, the Sakhalin venture in Russia, the Tangguh project in Indonesia and projects in Qatar and Yemen help meet demand, he said.