Despite heightened trade tensions between the two countries, Australian LNG shipments to China set a new high. Natural gas cooled to a liquid form (liquefied) at around -260° Fahrenheit for shipment and storage is known as liquefied natural gas (LNG).
In a natural gas pipeline, the volume of liquid natural gas is roughly 600 times smaller than that of gaseous natural gas. This 19th-century liquefaction technique allows natural gas to be transported to locations where natural gas pipes do not reach and used as a transportation fuel.
According to EnergyQuest's newest study, Australia shipped a record 30.7 million tonnes of LNG to China for an estimated A$15.6 billion. According to import figures, deliveries from Australia increased by 7.3 percent from the previous high of 28.6 million tonnes set in the entire year ended June 2020.
The study showed that China has now surpassed Japan as Australia's top LNG customer.
LNG Production and Export
According to EnergyQuest, Australian LNG shipments to China totaled 30.7 million tonnes (Mt), much above declared contracts of 19.4 million tonnes. NWS, Gorgon, QCLNG, and APLNG are the projects having China contracts.
Except for Gorgon, everyone over-delivered on their contracts. Moreover, even without formal China commitments, every other Australian LNG project delivered cargoes to Chinese customers.
Portfolio volumes and spot sales have contributed to the increased supply. QCLNG, for example, had 3.6 Mtpa China commitments but delivered 6.9 Mt in FY 2021, with the additional volumes coming from Shell's portfolio contracts.
"Even though GLNG has no China contracts, it supplied 1.1 million tonnes to China, most likely from Petronas' portfolio," the Australian firm stated.
China imported a total of 76.1 Mt in the 12 months to June 2021, up 19.6% year on year from 63.6 Mt the previous year. Import prices were 15 percent lower, averaging US$6.87/MMBtu against US$8.12/MMBtu the prior year.
From US$8.30/MMBtu the previous year, average Australian prices decreased by 20% to US$6.66/MMBtu. According to the consultancy, the total landed value of Australian LNG imports in FY 2021 was US$10.6 billion (A$15.6 billion), down from US$12.3 billion (A$18.8 billion) the previous year.
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