LNG

The United States said it exported more liquefied natural gas than any other country in the first half of 2023 with shipments averaging 11.6 billion cubic feet per day during the period, which was 4 percent more than in the same six months of the previous year.

Höegh LNG Holdings Ltd and Australian Industrial Energy have signed a final charter deal for the deployment of a floating storage and regasification unit at Port Kembla south of Sydney to help ease energy shortages in the state of New South Wales.

Petronet LNG, the owner of the largest Indian cargo import terminal at Dahej north of Mumbai, reported record earnings in the third quarter of the fiscal year as natural gas prices increased, though the nation’s imports were down in December for a third month.

Australian exports of liquefied natural gas hit a record high in 2021 to keep the nation in the World No. 1 spot of global exporters from its 10 liquefaction plants in the East and West coasts and in the Northern Territory.

Australian company Venice Energy has received approval from the state government of South Australia to construct an import facility in Port Adelaide even as the nation is the World's No. 1 exporter.

Export earnings from Australia’s 10 liquefied natural gas export facilities with nameplate capacity of 88 million tonnes per annum are expected to surge to A$50 billion (US$36Bln) in the current fiscal year from A$30Bln last year as oil-linked contract prices surge.

Woodside Petroleum, the operator of two liquefied natural gas export plants in Western Australia, posted 63 percent higher second-quarter revenues of US$1.32 billion compared with US$805 million in the same period last year as Asian LNG demand surged and prices increased.

AGL Energy of Australia has pledged at the annual meeting to pursue the Crib Point LNG project on Westernport Bay, south of Melbourne in the state of Victoria as one of the vital tools in the cleaner energy transition.

Australia exported a record 79.1 million tonnes of LNG in the 12 months to June 2020, up 5.9 percent from 74.7MT a year earlier while domestic gas consumption grew on both the East and West coast markets in the second quarter in contrast to the experience during Covid-19 across most of the developed world.

Australian domestic gas consumption on the East Coast was 7.7 petajoules higher quarter over quarter in the second three months of the year, according to the monthly report from consultants EnergyQuest.

“Gas-use-for-power (GPG) was down by 5.9 petajoules in the quarter, though other gas-use (residential, commercial and industrial) increased by 13.6 petajoules with increases in all states except New South Wales,” said the report.

EnergyQuest noted that as one of the world’s major LNG producers Australia is to some extent becoming a price-maker
in relation to spot prices.

The Platts Japan-Korea Marker has increased from US$2.15 per million British thermal units at the start of July to US$4.66 per MMBtu on 4 September.

“This coincides with unexpected outages at the Western Australian Gorgon LNG project due to the shut-downs for repairs,” said the report.

The national regulator, the Australian Competition and Consumer Commission publishes East Coast netback gas price estimates based on the Platts JKM.

This means that unexpected developments in Western Australia that affect spot prices will directly feed in to East Coast netback
estimates and possibly East Coast prices.

“To this degree any domestic contracts indexed to LNG spot prices will be hostage to unexpected shutdowns by West Coast projects, as well as projects elsewhere in the world,” EnergyQuest explained.

The overall Australian LNG export market followed the rest of the world on the score that towards the end of the year the industry began to buckle under the weight of a global glut of the fuel.

Production of LNG in the second quarter of 2020 fell to 19.1MT, the lowest since the third quarter of 2018. 

In July. Australian projects shipped a total of 5.8MT (85 cargoes), only marginally lower than 5.9MT (85 cargoes) in June, but well below the record level of 7.0MT in December 2019.

“From May onwards, the effects of Covid-19 on Australian LNG (in an already oversupplied LNG market) began to hit home,” said the report..

“Projects began extending maintenance periods to rein in production and experienced cargo deferrals. Of the 85 Australian cargoes shipped during June, 33 cargoes were delayed during the month,” it added.

The immediate impact on LNG price realisations was mixed.

Producers such as Woodside Petroleum, operator of the North West Shelf and Pluto LNG export plants, with a relatively high proportion of spot cargo sales, felt the biggest price impact.

However, the East Coast Australia-Pacific LNG facility and the Santos-run Gladstone LNG saw out the full year to end-June 2020 with little deterioration in realized prices.

Total export revenue for the year to June was A$47.8 billion (US$34.8Bln), down only 3.8 percent from a year earlier.

However, the negative impact on prices and revenues was accelerating thereafter.

Export revenue in the second quarter of A$10.5 billion was down 16.1 percent from $12.6 billion in first quarter.

“Queensland’s LNG projects finished the financial year strongly. All three projects shipped record tonnages in FY 2020,” said the report.

“Queensland LNG export revenues were steady at A$4.16 billion between Q2 2019 and Q2 2020 and up slightly from the first quarter. However, revenues are likely to have turned down from July,” it added.

The latest round of quarterly reports by Australian oil producers laid bare the full effect of the pandemic-led collapse in oil prices.

Realised oil prices for Woodside Petroleum, which emerged in Q2 2020 as the country’s largest oil producer, plunged to US$31 per barrel in the second quarter of 2020, down 55 percent from US$69 per barrel in the same period of 2019.

“The latest price was also down sharply from Woodside’s average realised price of US$52 per barrel in the first quarter of 2020,” said the report.

“The country’s second and third largest oil producers, Beach Energy and Santos, suffered a similar fate to Woodside,” it added.

Japanese companies JGC Corp. and Chiyoda Corp. and US engineer KBR who built the onshore Ichthys liquefaction and export plant at Bladin Point near Darwin in Australia, have lost a Court of Appeal case for a US$1.9 billion claim against a power station sub-contractor.