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Australian LNG

Australian LNG

Australia is another contender for the Asian LNG market.

It is geographically closer to Asia than is the US. But Australian LNG needs firmer, long-term contracts to keep its “greenfield” projects financially sustainable.

Australia, already a major LNG exporter, plans to expand its LNG export capacity in the coming years.

In late 2015, two terminals began service in Australia, Gladstone LNG and Australia Pacific LNG, both located on Australia’s East Coast. Australia could add six new LNG export terminals by 2020, tripling its liquefaction capacity to over 13 Bcf/day.

Australia is physically closer to Asian customers, lowering shipping costs. Japan has typically taken in over 70 percent of Australia’s LNG exports, but Japan’s power consumption is now at its lowest since at least 1998, with LNG facing the headwinds of more coal plants, solar capacity, and a nuclear re-start. The US has lower production costs and lower capital costs for new infrastructure, namely liquefaction facilities.

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