Record Australian LNG exports to China in FY 2021

Australia supplied a record 72.4 Mt of LNG to North Asia – China, Japan, Korea and Taiwan- in FY 2021, up from 71.4 MT the previous financial year.

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The total landed value of this LNG is estimated to be A$38.9 billion, down from A$49.9 billion the previous year reflecting the fall in oil prices to which most Asian LNG is indexed.

Australia exported a record 30.7 Mt to China, worth an estimated A$15.6 billion. The previous record was 28.6 Mt in FY 2020. Deliveries from Australia increased by 7.3%, notwithstanding trade tensions. China has now overtaken Japan as Australia’s largest LNG customer (Figure 1).

Figure 1 Australian LNG deliveries (Mt)

There were also record Australian exports to Taiwan of 5.5 Mt (previous record 4.6 Mt in FY 2020).

Australian exports to China of 30.7 Mt were much higher than disclosed contracts of 19.4 Mt. The projects with China contracts are NWS, Gorgon, QCLNG and APLNG. All except Gorgon supplied above their contracts.

Also, every other Australian LNG project supplied cargoes to Chinese buyers, even without explicit China contracts. The additional supplies are from portfolio volumes and spot sales.

For example, QCLNG has China contracts of 3.6 Mtpa but supplied 6.9 Mt to China in FY 2021, with the additional volumes coming from Shell’s portfolio contracts. GLNG has no China contracts but delivered 1.1 Mt to China, most likely from Petronas’s portfolio.

Australia also exports more to Taiwan than its disclosed contracts, 5.5 Mt in FY 202, compared with contracts of 0.9 Mtpa.

Japan is an opposite case, with contracts of 31.3 Mt but Australian deliveries in FY 2021 of 28.3 Mt. Some of the difference would have actually been delivered to China.

Despite the impacts of COVID-19, the four major North Asian LNG buyers all increased their LNG imports in FY 2021, most significantly in the case of China, with an increase in imports of 19.6%. China is expected to soon become the world’s largest LNG buyer, replacing Japan. Chinese volumes were close to Japan but did not overtake them in FY 2021.

Source: Energy Quest