CANBERRA: Australia’s liquefied natural gas (LNG) exports surged by 37.7% to 36.8 MT in 2016 as a plethora of new projects in Western Australia, the Northern Territory and Queensland triggered a flood of new shipments to global markets. Total exports were 10.1 MT above the 26.7 MT shipped in 2015, says energy consultancy firm EnergyQuest, noting that performance is expected to be even stronger this year. As APLNG and Gorgon continue to ramp up and new LNG projects like Wheatstone and Ichthys come into production, Australia’s 2017 exports will be close to 60 MT, up by 63% on 2016. Notwithstanding the lower oil price environment present through much of last year, EnergyQuest estimates the total value of Australian LNG exports as AU$17.9 billion in 2016. This is an 8.6% dollar increase over the previous year. Oil prices to which LNG prices are linked are now around 25% higher than the 2016 average, reflecting recent decisions by the Organization of the Petroleum Exporting Countries. If current oil prices are maintained, EnergyQuest estimates that the value of Australian LNG exports will double to around $36 billion in 2017.
Australia’s newest LNG hub – the three new plants around Gladstone – not surprisingly saw Queensland LNG exports nearly triple to 17.5 MT in 2016. West coast exports were down slightly at 19.3 MT for the period. Most Australian LNG exports continued to go to established customers with long-term contracts during the year. Japan remains the largest customer, taking 48% of 2016 cargoes. China is now the second biggest customer, taking 30% of cargoes. Korea is an emerging buyer with 53 cargoes and 2016 saw about 16 cargoes to India. There has been particularly strong demand for LNG in North Asia where spot prices are now the highest in two years. The Platts JKM marker was US$9.75/MMBtu early in January, well above LNG contract prices of around US$7.00/MMBtu. High spot prices are also attracting US LNG cargoes into North Asia. EnergyQuest CEO Graeme Bethune said shipments from the Sabine Pass project on the US Gulf Coast, which were mostly going to South America, are now heading to North Asia with nine of the 12 December loadings heading there.“However, this does not appear to be adversely affecting Australian exports, which are also well positioned to take advantage of high spot prices,” he added.
