ExxonMobil Considers Importing LNG to Australia

Monday, June 18, 2018

ExxonMobil Corp, southeastern Australia's biggest gas supplier, is considering importing liquefied natural gas (LNG) to help plug a looming gas shortage from 2021 and protect its market share.

The move would compete with plans by both Australia's no.2 energy retailer AGL Energy to start importing LNG by 2021 and a consortium involving Japan's JERA to start imports from 2020.

ExxonMobil is also stepping up exploration off the coast of Victoria and considering developing a gas field called West Barracouta close to an existing field, it said in an emailed statement on Monday.

"Combined with the existing Gippsland resource and infrastructure, an LNG import facility could ensure ExxonMobil can continue to meet our customers' needs," the company said.

The facility could open by 2022, it said.

Australia's energy market operator warned in March that Victoria, the country's biggest gas consuming state, could face shortages from mid-2021 due to a rapid drop in supply from the the Gippsland Basin Joint Venture, owned by ExxonMobil and BHP Billiton.

Output from the Gippsland Basin, the state's mainstay supplier over the past 50 years, is expected to fall to just half of 2018 levels by 2022, it said.

Even though Australia is set to challenge Qatar as the world's top LNG exporter, local gas supplies are under threat due to field declines and long-term export contracts.

ExxonMobil could use a lot of its existing infrastructure at Longford in Victoria for an LNG import facility.

The company declined to comment on an estimate by Macquarie analysts cited in The Australian newspaper that it could build import facilities for around A$100 million ($74 million), less than half the estimated cost of the two rival LNG import plans.

AGL is working toward a final investment decision for its import plans by June 2019.

"If we saw some new supply come to market that fundamentally changed that market dynamic, we would revisit the business case, but we haven't seen that to date," AGL General Manager Phaedra Deckart told Reuters in an interview last week.

She said rising LNG prices would not deter the company from going ahead with the plan.

"It's not about what price can we bring LNG into the market. It's about meeting the needs of our 1.4 million gas customers and the 10 large industrial customers that have executed (tentative agreements) with us and are looking for a new source of supply to meet that shortfall beyond 2020."

($1 = 1.3450 Australian dollars)

(Reporting by Sonali Paul; editing by Richard Pullin)

Categories: Tankers Energy Logistics Ports LNG

Related Stories

POSH Set to Tow Nguya FLNG from China to Eni’s Congo Field

Technip Energies Gets FEED Job for Inpex’ Abadi LNG Project in Indonesia

Seatrium Signs FLNG Vessel Upgrade Deal for Golar LNG

Inpex Kicks Off FEED Work for Abadi LNG Scheme Offshore Indonesia

ADNOC Signs Long-Term LNG Deal with Hindustan Petroleum Corporation

CNOOC Finds Oil and Gas in South China Sea

Santos and QatarEnergy Agree Mid-Term LNG Supply

Centrica and Thailand’s PTT Ink Long-Term LNG Supply Deal

Thailand's PTT to Buy LNG from Glenfarne's Alaska LNG Project

Woodside Agrees Long-Term LNG Supply with Petronas Unit

Current News

Malaysia’s Petronas and Oman’s OQEP Strengthen Oil and Gas Ties

Southeast Asia’s 2GW Cross-Border Offshore Wind Scheme Targets 2034 Buildout

Pharos Energy Kicks Off Drilling Campaign Offshore Vietnam

Viridien to Shed More Light on Malaysia’s Offshore Oil and Gas Potential

US Pressure on India Could Propel Russia's Shadow Oil Exports

Energy Drilling’s EDrill-2 Rig Starts Ops for PTTEP in Gulf of Thailand

RINA Wins FEED Contract for Petronas’ Flagship CCS Project in Malaysia

ABL Secures Rig Moving Assignment with India's ONGC

Pakistan, Türkiye Deepen Oil and Gas Ties with Offshore Indus-C Block Deal

Eni-Petronas Gas Joint Venture Up for Launch in 2026

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com