EnergyQuest has published its Australian LNG Monthly report for December 2020, which included a year in review analysis, and forward looking estimates, with production tipped to increase in 2021.
Australian LNG shipments were lower in December 2020 compared to November, according to the report, which was attributed to decreased production at the Ichthys, Gorgon and Wheatstone projects. Australia’s December shipments were 77.0 Mtpa on an annualised basis.
2.186 Mt (33 cargoes) of LNG were shipped by east coast projects in December, overtaking the November record of 2.126 Mt. The east coast projects operated at 102 per cent of nameplate capacity during December.
There were less cargo delays during December, with only nine Australian cargoes delayed for more than three days. Deliveries to major north Asian markets also increased slightly higher in December compared with December 2019.
The Platts JKM LNG achieved a six-year high spot price for January of US$15.10/MMBtu, despite challenges like a tighter shipping market, supply disruptions and cold weather in China and South Korea.
The Gladstone LNG producers saw a production deficit in December, with total production from LNG producers 6.6PJ less than total LNG exports. This is higher than the November deficit of 6.2PJ deficit.
Moomba and Victorian offshore gas production rose by 14PJ, including from storage, compared with November and higher compared to a year ago.
The report showed that electricity generation continues to be mostly unaffected by COVID-19 restrictions, although east coast generation was down by three per cent in December compared with a year earlier.
2020 year in review highlights
- Australia achieved an export record of 78Mt of LNG in 2020 (up from 77.5Mt in 2019), despite the impacts of COVID-19
- Australian projects operated at 89 per cent of operation nameplate capacity of 87.8Mtpa
- Australia’s top export destination was Japan again
- Western Australia dominated Australian LNG, supplying 56 per cent of national exports; while Queensland produced 29 per cent and the Northern Territory 15 per cent
- Western Australia’s North West Shelf was the biggest contributing project, followed by the two Chevron-operated projects, Gorgon and Wheatstone
The outlook for 2021
- A further 3.6Mtpa of LNG production is expected to be added upon Prelude reaching full production capacity, plus an additional 5Mtpa from Gorgon once kettle cooling repairs have been resolved
- Export volumes for 2021 are predicted to be around 80Mt
- LNG export revenue will likely be increased from higher oil and spot LNG
- LNG export revenue could be pushed to almost $50 billion from a return to the average prices experienced in 2019