The report says Australia’s gas production growth will have it rivalling Qatar as the world’s largest LNG exporter by 2020, but only if export plans are fully realised.
“Commitments to new resource developments in Australia have slowed markedly over the past year or so and the prospects of another round of major Australian LNG projects will depend heavily on how costs evolve, on the deployment of new, potentially less-costly technologies such as floating LNG, and on competition from other regions, notably North America,” the report says.
APPEA chief executive David Byers said it was not just North America that Australia had to be wary of.
There are offshore developments in east Africa to consider and the IEA has identified the possibility of Russia expanding its LNG capacity to reach into the coveted Asian markets.
“Australia has enormous potential supplies of natural gas, but if we fail to harness the opportunity to remain competitive in global markets, further resources will remain undeveloped and jobs will be lost along with the potential for cheaper, cleaner energy and future tax revenues,” Byers said.
According to the IEA, more than two-thirds of global investment in LNG is in Australia, where there are already three LNG export projects operating and another seven being built.
Worldwide, there are 12 LNG export plants under construction with a combined capacity of about 130 billion cubic metres a year.
Fresh capacity is set to come into operation in 2015-18, although the timetable is “heavily contingent on what happens in Australia where seven of the 12 terminals are located and where projects have seen cost escalations and delays”
The giant Chevron-operated Gorgon LNG project has been blighted by cost overruns. Part of these came from the fact that the processing plant is on an island that is also an A-class nature reserve.
Weather delays and lower than expected productivity at the Australian Marine Complex in the Perth southern suburb of Henderson have also played a part.
In light of these, Chevron has put doubt on it going beyond the first phase of three LNG trains at Gorgon.
