PM signs agreement securing Gladstone’s LNG future
The short term future of Gladstone’s Liquefied Natural Gas industry has been secured after Prime Minister Scott Morrison signed agreements with local industry heavyweights.
The agreements, signed between the Australian government and operators of Gladstone Liquefied Natural Gas exporters, secure both domestic gas and exports.
Independent energy market analyst Energy Quest detailed the agreement, plus more relating to the Gladstone LNG industry in a recent report.
“Prime Minister Scott Morrison has signed a new Heads of Agreement with the operators of the three LNG exporters in Gladstone to ensure adequate domestic gas supply for the next two years as part of the JobMaker plan,” Energy Quest stated.
“The government said they would ensure “more gas is offered to the domestic market, more often, and on more competitive terms” but has not instituted a ceiling price or price cap after earlier suggestions it would try to force one.
“How much supply will be offered to the domestic market was also left unsaid.
“Exporters must first offer uncontracted gas to the domestic market before sending it offshore.”
This development follows reports by Energy Quest that Australia has the largest LNG market share in both China and Japan.
“Australia had by far the largest market share in China in 2020 with 29.1 Mt (43.3 per cent) of the total LNG imports,” Energy Quest stated.
However, market share was reduced in 2020, compared to 2019.
“In 2019, Australia exported 27.9 Mt to China (46.1 per cent of total imports),” said the report.
“Australia also had the largest share of the Japanese market, with 29.1 Mt (39.1 per cent) of the total
“Although total exports to Japan from Australia fell in 2020 compared to 30.1 Mt in 2019, market share increased marginally to 39.1 per cent from 38.9 per cent in 2019 due to Japan’s falling import volumes.”
Overall, LNG exports were up last year.
“EnergyQuest estimates Australia delivered a total of 78.7 Mt LNG in 2020, up 2.2 per cent from 77.0 Mt delivered in 2019,” the report stated.
“The Gladstone LNG producers had a production deficit in January, with total production from
LNG producers 2.8 PJ less than total LNG exports.
“This is lower compared with December when the producers had a 6.6 PJ deficit.
“LNG producers had a surplus of 7.5 PJ in January 2020.”
Gladstone Ports Corporation data shows the east coast projects shipped 1.3 Mt to China
in January (1.4 Mt in December), 0.29 Mt to Korea (0.28 Mt), 0.19 Mt to Japan (0.32 Mt, and
0.06 Mt each to Malaysia (0.19 Mt) and Singapore.
In January 2020 Gladstone shipped 1.4 Mt to China, 0.29 Mt to Korea, 0.13 Mt to Japan and 0.19 Mt to Malaysia.
“There were two January spot cargoes reported from the east coast, both Petronas cargoes
from Gladstone LNG,” the Energy Quest report said.