Australian liquified natural gas (LNG) production rates will increase in 2021 as a result of the Prelude operation forecast to reach full production and Gorgon improving its rates following repairs.
Outlined in EnergyQuest’s Australian LNG monthly December 2020 report, Gorgon is forecast to contribute an additional 5 million tonnes per annum (Mtpa) once repairs to the cooling kettles have been resolved and production is back to full capacity, with export volumes for 2021 likely to be around 80 million tonnes (Mt).
The report adds that higher oil and spot LNG prices are also likely to increase LNG export revenue.
“A return to the average prices experienced in 2019 could push LNG export revenue close to $50 billion. However, a return to warmer than average northern hemisphere winters could see a collapse in spot prices this time next year,” the report stated.
In addition, LNG shipments in December were lower compared with November, primarily due to decreased production at the Ichthys, Gorgon and Wheatstone projects in Western Australia.
Australian LNG projects shipped 6.5 million tonnes (Mt) in December, on par with 6.5Mt in November.
East coast projects continued to lead the way, shipping a record 2.186Mt during the month, eclipsing the record set in November of 2.126Mt.
EnergyQuest highlighted that that east coast projects operated at 102 per cent of nameplate capacity during the month, which was the third month in a row that they produced at record levels, and the second month in a row they exceeded nameplate capacity.
Looking ahead, the report has highlighted that gas fields supplying the North West Shelf (NWS) are expected to start declining around 2022 and 2023.
At the end of last year, Woodside announced that the NWS project participants have executed fully-termed gas processing agreement (GPA) for processing third-party gas through the NWS project facilities.
In support of the GPA, the NWS project participants have also taken a final investment decision for the infrastructure required to receive gas from the Pluto-KGP Interconnector and the Burrup Extension Pipeline (which will be utilised for Waitsia gas).
The company expects to commence construction in the first quarter of 2021.