Australia attracts heavyweight gas players

Gary Park

Petroleum News Calgary correspondent

The world’s energy powerhouses are staking out territory that ensures Australia will move up the list of natural gas-producing countries.

ChevronTexaco, Royal Dutch/Shell, ExxonMobil and BP are all part of the line-up that is expected to tap 100 trillion cubic feet of proven gas reserves offshore Western Australia and the Northern Territory.

A Western Australian government commodities analyst predicts Australia’s annual consumption of only 1 tcf will grow by 3.7 percent a year through 2020.

Two transcontinental routes are in the works, stretching 2,500 miles from the remote fields to the most populous cities on the east coast.

In addition, Australia is taking steps to reinforce its place among the world’s five leading liquefied natural gas exporters, after slipping last year to 7.37 million metric tons, well behind Indonesia, Algeria, Malaysia and Qatar.

State-owned China National Offshore Oil Corp. recently agreed to buy a stake along with five other partners in a new joint venture for Australia’s North West Shelf.

The $348 million project is designed to start at 3.3 million tons a year, delivering to China’s first LNG terminal.

Two other grassroots LNG projects have also been floated since the mid-1990s — the Darwin LNG project operated by ConocoPhillips to serve Tokyo Electric Power and Tokyo Gas; the North Australia Gas Venture with ChevronTexaco holding 57 percent and arguing to develop a stand-alone venture to feed the western United States and Mexico.

Australia, with its Timor Sea project, also takes a leading role among liquefied petroleum gas suppliers in the Asia-Pacific region, where Purvin & Gertz forecasts demand will grow at about 3.3 percent a year through 2005.