A senior ConocoPhillips (COP) executive said Monday that he expects collaboration to occur between proposed liquefied natural gas plants at Gladstone in Queensland state, with project consolidation possibly occurring at both the gas reserve and project levels.

Ryan Lance, senior vice president of exploration and production, international at ConocoPhillips, also brushed off concerns that there won't be enough LNG demand to support the construction of the LNG project it is building at Gladstone with joint venture partner Origin Energy Ltd. (ORG.AU).

"With the current recession and global downturn, folks are wondering if there's enough demand for the LNG that's out there. We believe there is," he told reporters after addressing an industry conference in Darwin.

"We believe that once we come out of this economic recession...that LNG will be a fuel for the future and a fuel of choice."

Lance said ConocoPhillips and Origin are still aiming to make a final investment decision on their project in 2010 and to produce first LNG in 2014.

He said ConocoPhillips is talking to rival projects about collaboration.

"There will be some natural shuffling as things emerge," he said.

"Certainly, we're looking to work with the other projects that are there...from the upstream, the midstream and the downstream side of the business," he said.

Lance said that ConocoPhillips is talking to potential Gladstone LNG customers throughout Asia, including in Japan, Korea and China.

He said he does not anticipate Japanese customers asking for a discount on LNG sourced from coal seam gas.

-By Ross Kelly, Dow Jones Newswires;

61-2-8272-4692; ross.kelly@dowjones.com