The LNG sector witnessed significant growth over the 2005 - 2008 period with a series of major export (liquefaction) and import (regasification) projects coming to fruition. While the industry is dominated by the Pacific Basin, especially the Asian consumer base countries of Japan, South Korea and Taiwan, new and exciting opportunities are arising in Africa, Europe and Latin America.
Australia has been an LNG exporter since 1989 and currently has two operational LNG export facilities, located in Karratha, Western Australia and in Darwin. At 2.51 trillion m³, Australia has the second largest reserves in the Asia-Pacific region after Indonesia, and its proximity to major LNG consumers such as Japan and China gives the country serious potential to further expand its LNG industry.
Australia’s LNG prospects are focused on three areas; the Bowen basin in Queensland, offshore fields around NW Australia and the Timor Sea. The latter is an important focus area for FLNG due to the remote nature of the fields and the technical difficulties of piping the gas to shore.
Many projects, such as Browse LNG, have been in development for years and have yet to see final sanctioning.
Even Greater Gorgon, which received its final go-ahead this year and is now scheduled for a 2014 start-up, was originally scheduled to be onstream in 2008. Delays have been caused by a number of factors including high development costs, skills shortages, problems related to joint venture partners and a time consuming regulatory regime; factors which are likely to continue into the 2010 - 2014 period. Even the global recession has failed to dampen some costs, with Woodside reporting a 6 - 10% increase in the total cost of the Pluto project due to slower than expected construction work.
With four terminals in operation; Guangdong Dapeng, Putian, Wuhaogou and Yangshan (Shanghai), and more than 12 under development, China is poised to become one of the world’s top LNG importers. Chinese gas consumption grew 22% from 2006 - 2007 and a further 16% from 2007 - 2008, and it is expected to recover relatively quickly from the recession in comparison to other countries. By 2015 LNG import demand is projected to increase to as much as 22 million tpa, compared to5 million tpa last year.
China’s biggest three buyers, CNOOC, PetroChina (CNPC) and Sinopec have signed a number of supply contracts with companies such as Woodside, BG Group, Shell, ExxonMobil and Qatargas. These companies will source gas from predominantly Australian (12.8 million tpa) and Qatari (12 million tpa) projects. Chinese buyers are also involved in the spot market and, in November 2009, PetroChina brought 10 cargos which were originally intended for Europe.
While the LNG industry has suffered in the last year, long-term interest in the sector remains strong. Gas demand in the main consumer countries is expected to recover from around 2011, with long-term economic growth in China and other emerging markets driving further growth through to 2014. Investment in LNG facilities is expected to reflect this trend throughout the 2010 - 2014 period. Much of the growth in expenditure expected at the end of the forecast period will come from Australian projects, which, assuming they continue to progress at the current rate, are likely to be completed in the 2015 - 2017 period. These projects will go a long way to meeting the increased gas demand from countries such as China.
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/11032010/lng_industry_prospects_growth_in_australia_and_china/