North West Shelf Australia LNG President Peter Cleary said Monday that demand for spot liquefied natural gas cargoes in Asia has almost vanished this year as a result of the global economic downturn.

"Spot demand for LNG in Asia, and Japan in particular, has almost disappeared," Cleary said at the fourth annual LNG World Conference.

North West Shelf Australia LNG is the marketing unit for the Woodside Petroleum Ltd. (WPL.AU) operated venture in Western Australia state.

In 2008, nearly all of the Shelf venture's production was sold under contract to long-term buyers, mostly Japanese and Chinese, Cleary said.

However early this year the market saw an "incredible reduction" in Asian LNG demand due to the effects of the global financial crisis.

The downturn came soon after the North West Shelf partners completed a A$2.6 billion expansion, in September 2008, that boosted the project's annual production capacity to 16.3 million metric tons a year.

Not all of the extra production was committed to long-term customers and this year the partners have sold spot cargoes to India and Europe, and recently discharged a cargo in Kuwait, Cleary said.

The six equal participants in the North West Shelf venture are BHP Billiton Ltd. (BHP), BP PLC (BP.LN), Chevron Corp. (CVX), Japan Australia LNG, a joint venture between Mitsubishi Corp. (MSBHY) and Mitsui & Co. (MITSY), Royal Dutch Shell (RDSB.LN) and operator Woodside.

Earlier Cleary said that Australia's total LNG production could reach 100 million metric tons a year next decade if "over a dozen" mooted projects in various stages of planning and development reach fruition.

"If all these projects go ahead LNG production in Australia could grow from current levels of about 20 million tons (a year) up to 80 to 100 million tons of LNG produced," he said.

Some new Australian projects may not come on stream until "around 2014" but will be well placed to take up a share of the expected growth in demand for the fuel, particularly in the Asia-Pacific region, including India, he said.

Cleary did not mention specific projects, but new ventures include Woodside's Pluto, due to start LNG shipments in early 2011, and Chevron's Gorgon, expected to make a final investment decision in the second half of this year.

-By Stephen Bell, contributing to Dow Jones Newswires; 61-8-9244-4243; sgbell@bigpond.com