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Australia has ambitious plans for liquefied natural gas exports to Asia, where demand for the superchilled fuel is expected to soar by more than 500% by 2050, as the region moves from coal to the least polluting fossil fuel.
“A strong LNG demand outlook in our region will allow Australia to capitalize on the growth of global spot markets and meet unexpected demand,” said the country’s resources and water minister, Keith Pitt, as quoted by Bloomberg this week.
Australia is one of the top three LNG exporters globally, along with Qatar and the United States. According to the government, it should now focus primarily on seven Asian markets, including Indonesia, Bangladesh, and Vietnam, to boost its presence in the region. The country will also continue to supply key markets in China, Japan, and South Korea.
In 2020, Australia topped Qatar as the world’s largest liquefied natural gas exporter, shipping some 78 million tons of the commodity abroad—a record high.
According to the Bloomberg report, Australia’s LNG export income hit some $23 billion in the 12 months to last June. Government forecasts anticipate the value of natural gas to continue rising over the next two decades and beyond.
Australia currently has the biggest nameplate LNG production capacity in the world, at a total 88 million metric tons annually. Qatar is breathing down its neck with plans to boost its own LNG capacity from 77 million to 110 million metric tons annually. The United States, meanwhile, has 107 million metric tons annually in total sanctioned LNG capacity, of which 36 million tons are annually under construction, according to Rystad Energy data.
To catch up with its rivals, Australia is investing heavily in even more LNG capacity despite calls from environmentalists to accelerate the shift away from fossil fuels entirely instead of shifting from one fossil fuel—coal—to another.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com