EnergyQuest Australian LNG Monthly August 2021

EnergyQuest has just released its Australian LNG Monthly for August 2021. Some of the highlights are:

  • What’s going on with global gas prices? Significant growth in gas demand post COVID-19 in both North Asia and Europe has created competition for LNG cargoes, particularly from the US and Qatar, pushing up gas spot prices to record levels for this time of the year.
  • Australian LNG is relatively unaffected, with most projects already operating near capacity and with revenue largely linked to oil prices rather than spot prices.
  • However, high global gas prices have pushed up LNG netbacks into double-digits. Notwithstanding higher Queensland LNG exports though, east coast spot gas prices have fallen to $7-9/GJ.
  • In August Australian projects shipped 7.18 million tonnes (Mt) (105 cargoes), higher than the 6.81 Mt (99 cargoes) in July, and just short of the record of 7.2 Mt (105 cargoes) in March 2021. 
  • Compared with July, Australian projects delivered 14 additional cargoes to China, Japan and Taiwan in August, but four fewer cargoes to Korea, Malaysia and Singapore.
  • West Coast shipments increased to 5.3 Mt in August (5.0 Mt in June), with 76 cargoes in August compared to 72 in July. A year ago, the west coast shipped 70 cargoes of 4.9 Mt. Gorgon and Prelude are now operating at full capacity. 
  • East coast shipments increased to 1.9 Mt in August (1.8 Mt in July), with 29 cargoes compared to 27 in July, and 26 cargoes of 1.7 Mt a year ago.  The east coast projects operated at 87% of nameplate capacity during August.
  • There were four spot cargoes reported from the east coast in Augustand five spot cargoes from the west coast (9% of total shipments).
  • Queensland exported gas to the other states in August, with flows in a westerly direction for the entire month. Net gas flows from Queensland to other states were 3.8 PJ in August
  • CSG production from fields operated by the LNG producers was 118.5 PJ in August, down from 119.3 PJ in July and 3.3 PJ above exports including fuel gas. 
  • Notwithstanding continued high LNG spot prices, Queensland short-term domestic gas prices in August were much lower averaging $8.68/GJ ($14.45/GJ in July) at Wallumbilla and $8.54/GJ ($14.96/GJ) in Brisbane, compared to those in July.  Southern short-term domestic gas prices in August were also significantly lower compared to those in July.
  • NEM power generation in August from coal was a record low for this time of year. Gas generation was down by 304 GWh. Gas-use for power generation was down by 2.79 PJ in August (22%) compared with a year earlier.

Information about the EnergyQuest Australian LNG Monthly is available by clicking here.