Singapore imports all of its natural gas, which is mainly used for power generation and petrochemical production. In 2004 Singapore consumed 233 billion cubic feet (Bcf) of natural gas, a greater than five-fold increase from the 2002 level of 41 Bcf.

Natural gas use is rising rapidly, as the government promotes policies aimed at reducing carbon dioxide and sulfur emissions, ensuring energy security, and promoting the country as a regional hub for an integrated gas pipeline network. In 2002, the government set a target of 60 percent of the country's electricity to be generated from natural gas by 2012. By 2003, this goal had already been met, and the Singapore’s Energy Market Authority (EMA) reports that about 80 percent of the country’s electricity demand comes from natural gas today. In November 2003 and June 2004, Singapore experienced power outages that were the result of natural gas supply disruptions. After the June 2004 incident, the government set up the Energy System Review Committee (ESRC) to study the root causes of the gas disruptions and propose measures to strengthen the energy system’s reliability. Among other recommendations, the ESRC called upon Singapore to diversify its sources of natural gas, as it has historically relied on Indonesia for its natural gas imports.

Singapore's Senoko Power currently imports 155 million cubic feet per day (Mmcf/d) of natural gas through a pipeline from Malaysian national oil and gas company Petronas. The Senoko-Petronas deal is set to expire in mid-2008, though news reports suggest the two firms are working to extend the contract. In June 2005, Singapore conglomerate Keppel Energy reached an agreement to purchase 115 Mmcf/d of natural gas over 18 years from Petronas. To transport the natural gas, Keppel and Petronas are jointly constructing a 3 mile pipeline between Plentong in the southern Malaysian state of Johor to the Senoko area in the north of Singapore. However, the Plentong pipeline will have a capacity to transport up to 290 Mmcf/d of natural gas, which could provide for increased sales of natural gas to Singapore in the future.

In January 1999, the Singaporean consortium SembGas signed an agreement to purchase West Natuna natural gas from Indonesian state energy company Pertamina. Indonesian natural gas to Singapore comes via pipelines from two separate fields. Since January 2001, West Natuna has supplied 325 Mmcf/d as part of a 22-year deal, while a pipeline from Asamera in Sumatra began supplying 350 Mmcf/d in 2006. Another 100 Mmcf/d of natural gas is anticipated to be delivered via the Asamera pipeline from the ConocoPhillips field to power Singapore's planned Island Power station, although the project has experienced numerous delays.

Singapore is currently studying the viability of building a liquefied natural gas (LNG) import terminal, thereby freeing itself from dependence on neighboring states for its natural gas supply. Currently all of Singapore’s piped natural gas imports come from Indonesia and Malaysia. The government set aside land for the terminal in September 1999 at Tuas View, but the project was stalled for several years because the estimated $500 million cost of the terminal was thought to make LNG more expensive than piped gas. The project has been revived over the past two years following rising oil prices and the natural gas disruptions in 2003 and 2004 that led to power outages. In February 2005, Singapore’s Energy Market Authority (EMA) awarded a $300,000 year-long feasibility study to Tokyo Gas Engineering (TGE) to advise the Singaporean government on the project. The results of the study have yet to be released. If approved, the project would be Southeast Asia’s first LNG import terminal.