As outlined in the Resource and Energy quarterly report March 2021, published by the Federal Department of Industry, Science, Energy and Resources, Australian gas export volumes are also expected to decline to 78 million tonnes in 2020–21 due to technical issues at the Prelude and Gorgon LNG plants in Western Australia.
However, LNG exports are forecast to recover to around $45 billion by 2025-26, with gas exports rising to 81 million tonnes in 2021–22, and remaining around these levels until 2025–26.
The rebound reflects a recovery in demand (as economies return to growth), an assumed resolution of technical issues, and Prelude ramping up towards its nameplate capacity.
The next wave of investment in Australian LNG projects is forecast to be uncertain, with weak market conditions resulting in final investment decision (FID) deferrals.
The report highlighted that most LNG projects in the investment pipeline are backfill projects required to support the ongoing operation of existing LNG facilities.
“The proposed Scarborough to Pluto LNG expansion — where a 5 mtpa train would be added to Pluto — is the only substantial expansion to Australia’s LNG capacity in the investment pipeline,” the report stated.
“Over the projection period, it is likely that at least one import terminal will reach a FID and commence importing LNG. The five potential projects are concentrated in south eastern Australia, and are aiming to start commercial operation by 2022 or 2023.”
In addition, in 2021–22, Australian crude and condensate production is forecast to increase by 7.1 per cent to 396,000 barrels a day, as technical issues are assumed to pass at Prelude and Gorgon.
The Resource and Energy quarterly report forecast production in 2024–25 to fall to 365,000 barrels a day, due to lower output at existing fields. However, output is projected to increase to 389,000 barrels a day in 2025–26.
Minister for Resources, Water and Northern Australia Keith Pitt said the forecast result shows how well the resources sector has managed the challenges of the past year and just how important it remains to our national economic success.
“This report confirms the remarkable resilience and strength of Australia’s resources and energy sector. The industry has remained safe and reliable suppliers to domestic and global markets throughout the pandemic,” he said.
“The increasing demand for Australian commodities has allowed export earnings to overcome challenging conditions for the benefit of the Australian economy and Australian jobs.”