EnergyQuest has outlined in its June LNG report that Australian cargoes continued to be delayed during the month, with 33 of the 85 cargoes either sitting in anchorage or steaming in circles prior to reaching their destination.
Based on shipping data, the report estimated that Australia exported 5.9 Mt of LNG in June, which was lower than May with a total of 6.5 Mt and 93 cargoes.
EnergyQuest estimates that Australian LNG export revenues decreased in June to $2.87 billion, down on $3.74 billion in May and down by 17 per cent on June 2019.
“We estimate WA earned export revenue of $1.36 billion, Queensland revenue of $1.15 billion and Darwin revenue of $0.36 billion. The decrease in revenue is a result of the lower export volumes seen during June and a lower lagged oil price. Revenues are now showing signs of the falling oil price,” EnergyQuest stated in the report.
In addition, EnergyQuest outlined that lower oil pricers were starting to feed through into Australian LNG, with extended maintenance, cargo deferrals, lower prices and asset write-downs.
As a result, Woodside and Shell have announced impairments in relation to their Australian LNG assets primarily due to lower prices.
Woodside has written-down the carrying value of its interests in Pluto, North West Shelf gas, Wheatstone, Sunrise and Kitimat. Shell has written down the value of QGC and Prelude.
Woodside has reported that 80 per cent of the oil and gas property impairment losses are due to the significant reduction in oil and natural gas prices assumed up to 2025.
“Additional contributors to the write-downs are increased longer term demand uncertainty impacted by the COVID-19 pandemic and macroeconomic dynamics, and increased risk of higher carbon pricing,” the report stated.