SEPTEMBER 27, 2013 2:04PM
AUSTRALIA is in the midst of a gas boom.
Domestic gas supplies and exports are expected to grow rapidly by the end of the decade, enticing more major international oil and gas players to set up shop.
While iron ore, coal and gold have traditionally been the nation’s big earners, analysts say Asia’s insatiable demand for energy will lead to strong growth in gas production, as more than $200 billion in projects come online.
The industry is talking about an imminent boom in liquefied natural gas (LNG) exports, with four-fold growth projected by 2020 as China and Japan soak up Australia’s supply.
But some analysts question whether the heady projections are realistic, given the risks that demand will not materialise.
Still, the federal government forecasts Australia will become the second biggest LNG exporter in just over two years.
Seven major projects are being built across the country, with three in WA, three in Queensland and one in the Northern Territory.
WA Premier Colin Barnett is certainly excited by the prospect of a gas boom in his state, predicting China’s rapid growth will continue and as Japan acknowledges it will need more gas post-Fukushima.
As well as trumpeting WA’s prized offshore conventional gas fields, Mr Barnett would love to the current shale gas boom in the US replicated in his home state.
“As some of the shale gas in the Canning Basin is developed I think you’ll see the same phenomenon,” Mr Barnett has said.
However, a recent HSBC report found a lack of roads and pipelines could hinder the industry’s development.
It hasn’t deterred junior explorer Buru Energy, and majors Mitsubishi and ConocoPhillips, from having a good look.
Meanwhile, new offshore projects are starting to produce gas, alongside the North West Shelf and Woodside’s Pluto project in WA.
Last week BHP Billiton flew in executives from Houston to open its $1.5 billion Macedon gas plant, which will supply 20 per cent of WA’s gas.
The modest-sized plant is set to be dwarfed by its gigantic Onslow neighbours including Gorgon, valued at $53 billion, and the $29 billion Wheatstone.
BHP’s head of conventional gas Steve Pastor said the company liked WA because of its decades-long experience in oil and gas, and its proximity to the export market.
“The advantage Western Australia has is it’s got fantastic resources,” Mr Pastor said.
Less than six months after Woodside canned its onshore gas plant near Broome, floating gas processing is now all the rage.
Proposed floating LNG vessels in the Browse Basin and Scarborough Basin are in the early development stages, while multinational Shell presses ahead with building its world first Prelude floating LNG vessel in Korea.
Such is the popularity of the model that Shell plans to build more floating LNG plants.
Energy giant Exxon Exxon and its equal partner BHP Billiton will soon decide whether to pursue a floating option for Scarborough this year.
“Floating LNG is considered the best option,” ExxonMobil says.