Australia on Monday said it expects liquefied natural gas (LNG) exports to climb to 76.5 million tonnes in the year to end-June 2019.
This compares to a forecast of 63 million tonnes for the 2017/18 fiscal year spanning from July to June and 52 million tonnes last year.
Higher export volumes will be driven by increased production at Chevron’s Gorgon LNG project, as well as the completion of the three remaining LNG projects under construction — Wheatstone, the Inpex-operated Ichthys LNG project and Shell’s Prelude FLNG, according to the latest quarterly report by the Department of Industry, Innovation and Science.
These three projects will add around 21 million tonnes to Australia’s LNG export capacity, bringing total nameplate capacity to around 88 million tonnes, the report notes.
According to the report, the Wheatstone project is likely to be the first of the three projects completed, with train 2 due online in the June quarter 2018 while first LNG production at the Ichthys project is expected in the March quarter 2018.
Shell’s Prelude FLNG project is likely to be the last of Australia’s recent wave of seven LNG projects to be completed, with Shell indicating Prelude will be completed between May and August 2018.
Destination-wise, Japan, South Korea and China are expected to be the major destinations for Australia’s LNG exports.
While prospects for growth in the imports of Japan and South Korea are limited, Australian producers are expected to capture an increasing share of both country’s imports, the report said.
Australia’s LNG export earnings rising substantially
The value of Australia’s LNG exports increased by 41 percent year-on-year in the September quarter, with both the price and volume of Australia’s LNG exports higher than a year earlier.
Australia’s LNG export earnings are forecast to increase from $22 billion in 2016–17 to $36 billion in 2018–19.
Rising export values will be propelled by higher export volumes and, to a lesser extent, higher prices, the report said.
Australia to overtake Qatar as world’s largest LNG exporter, but for a short period
Australia is expected to overtake Qatar as the world’s largest exporter in 2019. Qatar currently exports around 77 million tonnes per year.
However, Australia’s hold on the title may only be shortlived, the report notes, as the US LNG production grows and Qatar has announced plans to boost LNG production to 100 million tonnes.
There will be no investment no second investment wave in Australian LNG industry comparable to the boom of the last 10 years
In contrast, LNG exports are expected to increase rapidly in the US during the 2020s, underpinned by the relatively low cost of production of domestic gas.
This increase sees the US become the world’s largest LNG exporting country in the mid-2020s with LNG shipments from the US projected to reach 86 million tonnes in 2025 and 115 million tonnes in 2040, the report said.
The US time as the world’s largest LNG exporter, however, is only expected to be temporary as Qatar’s large and low cost gas resources provide the foundation for a continued expansion in its LNG exports over the next two decades.
This expansion begins in the early to mid-2020s, with Qatar having recently lifted its self-imposed moratorium on its North Gas field. Qatar draws level with the United States in the mid-2030s
before edging past the United States by the end of the decade, the report said.
LNG World News Staff