Crisis a threat to gas supply

LONDON (Reuters) - Weakening gas demand, low prices, regulatory uncertainty and the credit crunch are likely to jeopardise new projects, further undermining long-term energy security when economies recover, the International Energy Agency said on Monday.

"Falling gas prices and volumes have taken a heavy toll on all producers' cash flows, adding to the already serious problems in gas investment throughout the value chain," the energy adviser to 27 industrialised countries said in its Natural Gas Market Review 2009.

"Financing problems are likely to bedevil all new construction projects in 2009 and even into 2010."

The IEA said that unless there were several new liquefied natural gas project approved in 2009 and 2010, there would be a dearth of new capacity from 2012 onwards.

(Reporting by Daniel Fineren)