China boom drives LNG growth

The Australian Energy Review - - NEWS - EL­IZ­A­BETH FABRI NA­TIONAL

AUS­TRALIA’S liq­ue­fied nat­u­ral gas (LNG) in­dus­try is rid­ing high on in­creased de­mand from China, with to­tal ex­ports to the na­tion in­creas­ing by 40.5 per cent in 2017 to 17.5 mil­lion tonnes, En­er­gyquest’s lat­est re­port has found. Be­hind Ja­pan, China was now Aus­tralia’s se­cond-largest LNG mar­ket, mak­ing up 30.8 per cent of Aus­tralia’s to­tal LNG ex­ports of 56.8mt in the 2017 year. In De­cem­ber alone, Aus­tralian projects de­liv­ered 31 car­goes to China, up from 21 in Novem­ber. “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,” En­er­gyquest chief ex­ec­u­tive Dr Graeme Bethune said. “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.” Dr Bethune said LNG ex­ports had risen by 26.3 per cent in 2017, jump­ing from Aus­tralia’s fifth largest ex­port in 2016 to its thirds largest ex­port in 2017, over­tak­ing gold and ed­u­ca­tion. En­er­gyquest said the high ex­port vol­umes cou­pled with higher oil prices were es­ti­mated to have in­creased to­tal 2017 LNG ex­port rev­enue by 44.1 per cent to $25.8 bil­lion. “To put $25.8 bil­lion of ex­port rev­enue in per­spec­tive, this is more than the cost of Aus­tralia’s im­ports of pas­sen­ger ve­hi­cles, which was $21.8bn in 2016-17,” Dr Bethune said. “Pas­sen­ger ve­hi­cles are Aus­tralia’s se­cond big­gest im­port cost.” The in­crease in ex­ports was pri­mar­ily at­trib­uted to higher ship­ments from the Gor­gon and APLNG projects. How­ever, the North West Shelf (NWS) still re­mains the largest pro­ducer, with Gor­gon tak­ing se­cond place. En­er­gyquest said there would be fur­ther in­creases in 2018, as QCLNG, Gor­gon and Wheat­stone ramp-up to full ca­pac­ity and Ichthys and Pre­lude be­gin op­er­a­tions.

“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.”

Im­age: En­er­gyquest. En­er­gyquest chief ex­ec­u­tive Dr Graeme Bethune.

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