Weekend Edition: Australia On Track to Become Top Global LNG Exporter

It looks like Australia is on course to overtake Qatar as the world’s top LNG exporter by 2020 according to the Australian finance minister. They are working hard to profit from the growing Asian demand for liquefied natural gas with at least $98 billion worth of LNG projects under construction or planning.

Natural gas demand in Asia has been steadily rising over the past decade, consumption accounts for 60% of the world’s LNG. ??In China for instance, demand for natural gas could rise to as much as 43 billion cubic feet per day by 2030 up from 12 billion in 2011.

Asia LNG demand 2020

The size of the prize is huge which explains why Australians are not wasting time. On the other hand, I get the feeling we are not rising up to the challenge in Canada and the only reason we’ll end up taking a small part of the LNG market is due to supply outstripping demand by 2020.

Our natural gas producers in Canada face several challenges: reduced demand in the US due to rising domestic production and suppressed North American prices to top it all. We are clearly LOADED with natural gas up here but for some reason we lack the pipeline infrastructure and well, a working export facility! We currently have 2 in development stages.

While they’re not fooling around down under; we seem to be asleep at the wheel. We have the proximity advantage to Asia over Qatar which allows us to directly compete with the Australians and all the bells and whistles required to build long term partnerships (stability etc etc). Global demand is expected to outpace supplies by 2015 by anywhere from 11-41 metrics tons, how many export facilities will we have ready to sell our $2.00 AECO for 5x or more? Only one; Kitimat and it will be capable of exporting 5 metrics tons at startup’a shame if you ask me.

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Have a Great Weekend!