With huge natural gas resources and low sovereign risk, Australia has the potential to become a leading global supplier of LNG. This opportunity has not gone unnoticed by international oil companies, with numerous LNG projects now proposed across the country. Not all these projects can proceed as planned, but if they did they would contribute in excess of 80 million tonnes per annum of new LNG supply.

Some of this new capacity will be supplied from coalseam gas (CSG) resources in eastern Australia. As the scale of this resource emerges, the opportunity to develop a world class LNG export hub in Gladstone looks possible. There are specific technical and commercial challenges posed by CSG, however, that will determine how quickly capacity can be brought onstream.

With plans for numerous LNG projects progressing quickly, competition for labour and construction resources is acute. This competition is likely to impact the schedule of projects already under construction and projects looking to sanction in the coming months.

Competition is also strong in the Pacific Basin LNG market. Following the global recession, demand for gas is lower than previously forecast and projects are scrambling to sign up buyers ahead of each other. Not all will succeed and projects’ timelines are likely to change.

Wood Mackenzie’s presentation at APPEA 2010 will provide commercial insight into Australia’s evolving LNG industry. Our coverage will include insight into the differences between conventional and unconventional LNG projects. This will highlight the opportunities and challenges facing Australia as it looks to become a global leader in LNG supply.