Australian LNG industry riding high on China boom

Combined with higher oil prices, the increase in volumes pushed up Australia’s 2017 LNG export revenue by 44.1% to AUS$25.8 billion, according to the December LNG report from EnergyQuest.

EnergyQuest CEO, Dr Graeme Bethune, described 2017 as a watershed year for Australia’s LNG industry, with growth in demand from China the stand-out success story.

Total Australian LNG exports to China increased by 40.5% from 12.4 million t to 17.5 million t over the period.

Dr Bethune said: “China is now Australia’s second-largest LNG market and Australia is China’s biggest LNG supplier […] Increased Chinese demand is not only good for Australian LNG producers and our export revenue, but has an emerging positive impact for China’s environment. China is making a massive switch from coal to gas to reduce air pollution in major cities such as Beijing - and now Australian LNG is playing a significant role in achieving this goal.

“LNG jumped from Australia’s fifth largest export in 2016 to third largest export in 2017, overtaking Gold and Education.”

Other highlights of the EnergyQuest December monthly report included:

• Australia is the world’s second-biggest LNG exporter by a substantial margin and catching up with Qatar, the biggest exporter.
• The increase in exports in 2017 was primarily due to higher shipments from the Gorgon and Australia Pacific LNG (APLNG) projects. The North-West Shelf (NWS) remains the largest producer but Gorgon has rapidly increased production to take second place.
• Japan remains the largest importer of Australian LNG, importing 26.7 million t in 2017, up by 18.1% from 2016. Australia is Japan’s largest LNG supplier.
• Exports to Korea also increased significantly in 2017. Korea is Australia’s third-largest market and Australia is Korea’s second largest LNG supplier after Qatar.
• Two-thirds of exports to China and nearly two-thirds of exports to Korea come from Gladstone in Queensland.
• West coast LNG projects shipped 3.3 million t in December, down from 3.5 million t in November. Wheatstone did not ship any cargoes in December. It shipped one cargo in the first week of 2018.
• East coast LNG exports increased to a record 2 million t in December, up from the 1.7 million t seen over recent months. However, the increase in east coast exports does not appear to have had any significant negative impacts on the domestic gas market.

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/17012018/australian-lng-industry-riding-high-on-china-boom/