Australia could surpass Qatar as the top exporter of liquefied natural gas (LNG) in the world, partly because of several new LNG projects in the country.
An increase in Australian LNG exports has driven higher domestic natural gas prices. The growth in exports mainly stemmed from projects in the eastern seaboard, amidst a lack of supply for natural gas. By 2020, however, the country would surpass Qatar as the biggest LNG exporter worldwide.
The Department of Industry, Innovation and Science of Australia said that a $200 billion investment in the LNG industry would be the key to overtaking Qatar. By June 2019, the department expects Australia’s export capacity to reach 74 million tons, up from the estimated 63.8 million tons for 2017.
Qatar currently accounts for 32 per cent of the of global LNG exports, while it has the third biggest natural gas reserves at 24.5 trillion cubic metres. LNG production costs in the Middle Eastern country have been the cheapest in the world, which is the main reason it has been the biggest exporter. Still, three projects in eastern Australia could soon be a game changer.
The projects on Curtis Island in Queensland will be necessary to address a potential shortage of natural gas supply. The Australian Energy Market Operator expects a shortage to occur in the domestic market in the next two years.
As such, energy companies should consider storage solutions, such as self bunded fuel tanks, for conservation. This projected deficit may affect the country’s bid to become the top LNG exporter, as the government has imposed a rule until January 2023 that prevents a drop in domestic supply by limiting the number of exports.
It remains to be seen whether Australia could soon be the biggest LNG exporter. Even if it does not succeed, the country’s investments in LNG projects will be beneficial in addressing a potential shortfall of natural gas.