The International Energy Agency’s (IEA) recent recognition of natural gas as a growing part of the global energy mix should reinvigorate efforts to grow the industry in Australia, the APPEA reports.
The 2014 World Energy Outlook highlights the role natural gas plays in strengthening the world’s energy mix. The report finds that over the period to 2040, demand for natural gas will grow by more than half, the fastest rate among the fossil fuels, and increasingly flexible global trade in LNG will offer some protection against the risk of supply disruptions.
LNG plants
Australia currently has seven LNG plants under construction with a combined capital cost of more than AU$ 200 billion and these huge projects will soon be shipping Australian natural gas to our trading partners.
However, labour market strains, increased production costs, and increasing competition from North America and East Africa could damage Australia’s potential for future growth.
Global contribution
The APPEA stated: “Australia can continue to make a meaningful global contribution to reducing emissions and enhancing economic prosperity, but only if the LNG sector’s full potential is harnessed via regulatory and labour market reform.”
The US has already recorded some of its lowest carbon emissions in 20 years thanks to the shale gas revolution that has increased use of natural gas for power generation. China, a key market for Australian gas exports, is also moving away from coal-fired electricity generation in favour of natural gas.
LNG production in Australia
For every tonne of CO2-equivalent emitted in LNG production within Australia, up to 9.5 tonnes of emissions from coal-fired generation can be avoided globally.
In 2012-13, Australia shipped 23.9 million tonnes of LNG cargoes, earning AU$ 13.7 billion in export revenue. Australia’s LNG exports are expected to quadruple over the next five years.
Adapted from press release by Katie Woodward