Australia May Get 10% of New LNG Contracts, Wood Mackenzie Says
Australia’s global share of new contracts for liquefied natural gas may drop to about 10 percent a year by 2025 as U.S. exports rise, Wood Mackenzie Ltd. said.
Buyers may get 16 million to 20 million metric tons of LNG annually from Australian suppliers out of the extra 160 million tons a year that’s estimated to be needed to satisfy 2025 demand, Gavin Thompson and Andrew McManus, Wood Mackenzie consultants, said yesterday in an interview in Brisbane.
While Australia is forecast to surpass Qatar as the world’s largest exporter of LNG by the end of the decade with almost A$200 billion ($193 billion) of projects going ahead, it’s facing increasing competition from North America and East Africa. A planned A$100 billion of new plants is now in doubt unless the industry reduces costs, the Australian Petroleum Production & Exploration Association said.
“It’s a great opportunity for suppliers because demand is strong,” said Thompson, the Beijing-based principal consultant for Asia-Pacific gas and power. “But if you really consider every project, not all are going to go ahead.”
Suppliers worldwide are planning projects to produce more than 200 million tons of LNG a year and “chasing” the 160 million tons of gas that may be contracted for 2025, said McManus, vice president of energy consulting for Australasia. LNG buyers are forecast to get about 50 million tons a year from the U.S. between 2020 and 2025, according to Thompson.
Australia is expected to contribute about 25 percent of global LNG supply by 2018, Wood Mackenzie’s McManus said yesterday in a presentation at an industry conference. Further opportunities for Australian projects will probably be in floating LNG and expansion of existing developments, he said.
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