A new boost for the LNG industry
Gas suppliers and consumers alike will be interested to know that the national liquefied natural gas (LNG) industry has been given a significant boost with a new deal securing $2 billion of investment in Australia's gas resources.
Recently, federal minister for resources Gary Gray spoke at the 17th International Conference on Liquefied Natural Gas (LNG 17) in Houston, Texas, forecasting that Australia will become the biggest LNG exporter in the world within the next five years.
With seven of the world's twelve LNG projects now under construction in Australia, Mr Gray predicted that the nation's production will approach 90 million tonnes a year.
The industry has even made progress since Mr Gray's predictions at the conference in mid-April, as on May 6 a landmark binding LNG agreement was signed by BG Group and the China National Offshore Oil Corporation (CNOOC).
This agreement means that CNOOC will acquire a greater interest in the first two production trains of the Queensland Curtis LNG Project (QCLNG).
BG Group will supply CNOOC with an extra five million tonnes of LNG annually starting in 2015, and CNOOC will receive a 20 per cent interest in the reserves and resources of some BG Group tenements.
BG Group's Australian business QGC will remain operator and majority owner of QCLNG.
The QCLNG project is scheduled to be the world's first development where LNG is produced from natural gas out of coal seams, and first exports are predicted for next year.
So far, $11.4 billion has been spent on the project with an overall end-game expenditure of $20 billion forecasted.
It involves the expansion of natural gas production in the Surat Basin, and the construction of a 540 km pipeline network reaching to Gladstone and an LNG plant.
Currently, this development employs over 9,000 workers.
Mr Gray commented that this agreement has reaffirmed Australia as a leader in supplying cleaner hydrocarbon energy to global markets.
"Last month, following the prime minister's successful visit to China, our two countries announced a strategic partnership and the supply of minerals and petroleum, and increasingly LNG, is a key plank in our broader relationship," said Mr Gray.
"The future of LNG production is in Australia and today's agreement demonstrates we are increasing our capabilities in LNG construction and operation through a focus on innovation and the right approach from government and industry."
Posted by Callum Fleming