LNG export revenue takes $12.6b hit
Export income had been severely impacted by the lower oil prices seen through much of the year since April, together with low spot prices, the energy advisory firm said.
Its latest report showed the nation exported a record 78.0 Mt of LNG in 2020, up from 77.5 Mt in 2019.
This was a good result given disruptions to Gorgon, the fact that Prelude hadn’t produced since early February, issues seen at Wheatstone with reduced production, and the COVID-19 destruction of LNG demand, particularly early in the year, EnergyQuest said.
The Australian projects operated at 89 per cent of operation nameplate capacity of 87.8 Mtpa.
The east coast had record production of 22.6 Mt, although up only 1 per cent overall from 22.4 Mt in 2019, the EnergyQuest update said.
It said one of the reasons why it had been possible to maintain strong Gladstone exports was that use of gas for electricity had been falling, replaced by renewables.
“Replacing east coast gas with renewables to free up gas to export to China to replace coal is a win-win both environmentally and economically,” the firm said.
“The three Gladstone projects operated at record levelsfor the last three months of 2020, with two months greater than 100 per cent nameplate capacity.”
There was scope to further lift Australian LNG production rates in 2021, EnergyQuest said.
A further 3.6Mtpa will be added when Prelude reaches full production capacity and an additional 5 Mtpa from Gorgon once repairs to the cooling kettles have been resolved and production is back to full capacity.
Export volumes for 2021 are predicted to be around 80 Mt
EnergyQuest also believes that higher oil and spot LNG prices are likely to increase LNG export revenue.
A return to the average prices experienced in 2019 could push LNG export revenue close to $50 billion. However, a return to warmer than average northern hemisphere winters could see a collapse in spot prices this time next year.
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