EnergyQuest has just released its July 2019 LNG Report. Some of the highlights are:
Notwithstanding the winter weather, conditions eased in the east coast gas market in July. CSG production from fields operated by the LNG producers was up by 5.0 PJ compared with June and with lower LNG exports, the producers produced a surplus of 17.2 PJ above exports.
Queensland exported 8.1 PJ to the southern states. East coast short-term gas prices were lower than those in June and lower than July 2018. East coast gas-fired generation was up by 36% on a year earlier.
New FY 2019 figures show Japan is still the largest buyer of Australian LNG (29.5 Mt or 39% of Australian exports). Ninety-five percent of Japanese imports from Australia come from Western Australia or the Northern Territory.
The average landed price of Australian LNG in Japan in FY 2019 was A$14.25/GJ (prior to regasification and pipeline costs), well above Australian domestic prices.
China, the second largest buyer, is closing the gap to Japan, buying 27.2 Mt last year, or 36% of Australian LNG exports. Australia supplied 46% of Chinese LNG in FY 2019 and remains the biggest supplier to China. China is relying on Australia and Australia is relying on China.
Fifty-seven percent of Australian LNG exports to China in FY 2019 came from Queensland. Chinese companies have made huge investments in Queensland LNG and Queensland alone supplied a massive 27% of all China’s LNG imports.
Korea is becoming an increasingly important customer for Australian LNG exports. It commanded 10% of total Australian exports in FY 2019.
The concentration of Australian LNG trade in North Asia is both a strength and weakness. A strength as North Asia is the world’s largest and fastest growing LNG market. A weakness from lack of diversification and the risks this involves.
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