Australian LNG strengthens on high international gas prices
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High international gas prices continue to remain hugely beneficial for Australian liquefied natural gas (LNG) players with cargoes raking in anywhere from US$42m to US$56m each in January.
That’s one cargo of LNG carried by a single LNG tanker. Crazy times.
The exact price varied from company to company with Origin Energy (ASX:ORG), Santos (ASX:STO) and Woodside (ASX:WPL) realising average prices of US$11.80 per million British Thermal Units (MMBtu), US$13.64/MMBtu and US$16/MMBtu respectively as even long-term, oil-linked cargoes benefitted from rising oil prices.
While you would think that companies would seek to maximise their returns by shipping more cargoes, Australia actually exported less LNG in January – with 96 cargoes leaving our shores – compared to December, when 105 cargoes were shipped.
EnergyQuest said that this was due to short-term outages at the North West Shelf and Wheatstone along with repair work at Gorgon.
The Australian Bureau of Statistics previously noted that Australian LNG exports were worth $49.5bn in 2021, up 36.8% from 2020 while monthly revenue from LNG exports steadily increased to reach a 2021 high of A$6.3 billion in December, more than 3.5 times the low seen in September 2020.
It comes as LNG imports by North Asian countries increased by 10% to 220 million tonnes in 2021 over their imports in 2020.
Import prices also climbed from US$7.24/MMBtu in 2020 to US$10.52/MMbtu in 2021.
China has also overtaken Japan as the world’s largest LNG importer with 79.9Mt of LNG entering its ports in 2021, up from 67.4Mt in 2020.
Japanese LNG imports slipped by 0.2Mt to 74.3Mt while South Korean imports rose from 40Mt in 2020 to 46.1Mt in 2021.
Interestingly enough, Australia still retains the largest market share in China with 31.4Mt of imports.
The US was next with 9.3Mt, edging out Qatar with 9.1Mt.
Australia also remains the largest supplier of LNG to Japan despite its market share dropping from 39.1% to 35.8% while Qatar took pole position in South Korea.
Despite the high international prices, Australian East Coast gas prices actually fell, from $11-12 per gigajoule in December to $8-9/GJ in January.
This was despite Queensland importing gas from other states in January.