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EnergyQuest: LNG exports holding strong

Australia’s LNG exports are holding near-record levels thanks to continual demand in Asia, according to analyst EnergyQuest.

In its latest report, EnergyQuest said national LNG production in the first quarter of 2020 hit 19.9 Mt, only marginally below the record levels of the previous two quarters, while Queensland exports hit a monthly record in April of 2 Mt.

Growth in demand for LNG from Korea, China and Taiwan offset a small drop in demand from Japan and EnergyQuest said it expects total LNG export revenue for 2019-20 to be around $50 billion, similar to the previous year.

Despite LNG holding up, the energy analyst said the oil price collapse and COVID-19 pandemic had left around $60 billion worth of in-development Australian LNG projects in limbo.

“It is still early days in trying to assess the long-term impact of COVID-19 on the energy sector,” EnergyQuest said.

“Some trends that were already apparent such as lower energy prices have accelerated.

“There has also been marked volatility in energy and share prices while in Australia at least gas and electricity volumes have held up while transport fuel demand has been slashed.

“The good news is Australia’s largest oil and companies can ride out even a lengthy period of Brent prices at US$30-40/bbl ($43-57/bbl) because of cost discipline baked in from the previous oil price collapse in 2014 and sound balance sheets.

“For example, the most vulnerable of the Australian companies in the previous downturn, Santos, is targeting a cash flow break even oil price of US$25/bbl ($36/bbl) by the end of this year by slicing a further US$50 million ($72 million) from operating costs.”

For more information visit the EnergyQuest website.

If you have news you would like featured in The Australian Pipeliner contact Managing Editor David Convery at dconvery@gs-press.com.au

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