EnergyQuarterly June 2019

The June 2019 EnergyQuarterly report has just been released, with comprehensive Australian oil and gas data for the March Quarter 2019 plus analysis of the latest developments. Here are some of the highlights:

  • The east coast gas market was just in balance overall in Q1 2019 compared with a small deficit in Q1 2018.
  • Conventional gas supply on the east coast bucked the long-term trend by increasing in Q1, with production up 6.0% or 5.3 PJ qoq to 93.2 PJ. 
  • AEMO released two significant reports in March 2019, the Gas Statement of Opportunities (GSOO) and the Victorian Gas Planning Report (VGPR). These latest reports are much closer to EnergyQuest’s assessment of the east coast gas outlook.
  • The first months of 2019 marked the beginning of a renaissance of onshore and offshore exploration over the next 18 months, beginning with potentially high-impact, Santos-operated wells Dorado-2, Roc South-1 and Dukas-1, and Strike Energy’s West Erregulla-2.
  • The contract-based trade of Australian LNG projects allowed them to enjoy a strong start to 2019, despite the sharp fall in spot prices and predictions of a global gas glut. In fact, LNG prices for most projects continued to rise in Q1 2019 compared to Q4 2018.
  • Asian LNG spot prices have currently decoupled from oil but that is of little relevance to the Australian LNG projects which have oil-based contracts and ship relatively few spot cargoes.
  • Average domestic gas prices continue to be at least $8/GJ lower than export prices on both the east coast and west coast. 
  • Australia’s LNG shipments in April were 81 Mtpa on an annualised basis, well ahead of Qatar’s nameplate capacity of 77 Mtpa. 
  • While LNG contract prices generally improved in Q1 2019, the volume of Australian LNG exports came off the boil due to a series of technical issues at west coast projects.
  • Production from Western Australian LNG projects dropped by 17.9% or 2.2 Mt to 10.1 Mt in Q1 2019, compared to Q4 2018. East coast LNG shipments reached a record 5.6 Mt in Q1 2019 on the back of record CSG production.
  • In its annual filing with the Australian Securities and Investments Commission, Arrow Energy has revealed a net loss after tax in 2018 of $752 millionTotal accumulated losses at the end of 2018 were $7.3 billion. This is before $4.4 billion of acquisition costs.
  • Santos overtook Beach Energy to become Australia’s largest oil producer in Q1 2019, thanks to a surge in production from its newly acquired Van Gogh/Coniston project. The consolation prize for Beach is it can now claim the Western Flank as Australia’s largest oil project.
  • National oil production posted its second consecutive quarterly increase in Q1 2019, adding to the view that Australia’s long downward spiral in oil production may have bottomed.
  • The fast ramp-up of the liquids-rich Ichthys LNG to 100% of nameplate capacity and a maiden cargo from Prelude boosted Australian condensate production by 63.6% qoq. 
  • Australian petroleum production dipped in Q1 2019 from the record level set in Q4 2018, reflecting interruptions to LNG shipments from a number of WA’s big projects.
  • The ranking of the top four petroleum producers was unchanged in Q1 2019 (Chevron, Shell, Woodside and BHP) but outside this group there were significant changes. Ichthys propelled INPEX from obscurity to fifth place on the table of Australia’s largest producers, and also elevated TOTAL into the top 10. Santos jumped into sixth place with the benefit of the first full quarter’s contribution from Quadrant Energy.
  • Timor-Leste is seeking Chinese backing for its plans to develop Sunrise, including building a port on the south coast.

Further infomation, including the brochure with full table of contents, can be obtained by clicking here.