Australia’s recently developed offshore gas fields are set to lift the nation to the top of the list of world’s largest LNG exporters.
In a report on Thursday, energy intelligence firm EnergyQuest said Australia is on the cusp of taking becoming the world’s biggest exporter of Liquefied Natural Gas (LNG), boosted by the expected ramp-up of the Inpex-operated Ichthys offshore gas project. This is in addition to previously launched giant gas developments Wheatstone and Gorgon.
“With the milestone visit to Darwin tomorrow (Friday) by Japanese Prime Minister, Shinzo Abe, for the official opening of the $US40 billion INPEX-operated Ichthys LNG project, it is that project that is set to drive Australia to the premier LNG export position,” EnergyQuest said.
EnergyQuest monthly LNG report for October says that total Australian LNG shipments were significantly higher in October at 6.4 million tonnes (Mt) – up 10.3% on 5.8 Mt in September.
The increased export shipments were boosted in part by the start of production from the Ichthys plant which saw its first LNG cargo depart Darwin on 22 October, followed by two further cargoes, EnergyQuest said.
EnergyQuest Chief Executive, Dr Graeme Bethune, said on Thursday that the higher October shipments were 76 Mtpa on an annualised basis, prior to any significant production from Ichthys (annual capacity of 8.9 Mtpa) and the start-up of Shell’s Prelude project (3.6 Mtpa).
“As Ichthys ramps up production in coming months we expect Australia’s annualized production rate to overtake Qatar’s nominal capacity of 77 Mtpa, making us the world’s biggest exporter,” Dr Bethune said.
“Latest reports are for a further three Ichthys cargoes to load in November from the Darwin plant to be sold on the spot market.”
Dr Bethune said the October increase in Australian shipments reflected strong performance by west coast projects. East coast shipments were slightly below those in September, following agreement by east coast gas producers to offer uncontracted gas to the domestic market in the event of any shortfall.
Meanwhile, Dr Bethune said that after passing Japan in April this year as the world’s largest importer of natural gas (comprising both LNG and international pipeline gas), China’s LNG imports are growing quickly, with September imports up 26% on a year earlier.
“Australia continues to be the largest LNG supplier to China, supplying 43% of Chinese LNG imports in September,” he said.
“Notwithstanding strong Chinese demand, Chinese LNG imports from the US have slumped, from 0.5 Mt in January to only 0.1 Mt in September.
“This reflects the China-US trade war, plus record LNG shipping costs, particularly charter rates, which disadvantage longer distance transport,” he said.