Australia is on track to become the world’s largest LNG exporter by next year. Home to several giant offshore projects such as the Gorgon, Wheatstone, Prelude, and Ichthys, the country is fast closing in on the current top exporter of the fuel, Qatar. But unlike Qatar, Australia has not been able to fully enjoy this LNG boom. In fact, at least one part of the country is suffering an LNG shortage that has made imports a very urgent need.

Meet Queensland, home of the Australian Pacific, Queensland Curtis, and Gladstone LNG projects, with a combined annual production capacity of 25.3 million tons. Like its East coast neighbor Victoria, Queensland is standing on the brink of a chronic affordable LNG shortage resulting from the trebling of demand after the start of the Queensland projects, which pushed prices significantly higher, helped by declining production from legacy gas fields in the region and the fact that a lot of the LNG produced from the three projects are locked in long-term contracts.

Last year, the Australian government introduced a Domestic Gas Security Mechanism, allowing it to force LNG exporters to divert certain amounts of the fuel for the domestic market in case of a shortage. Apparently, however, this is not enough, not to mention that far from everyone is happy with this kind of interference in the LNG industry. As industrial gas consumers along the East coast grapple with a more than twofold increase in LNG prices and 10 percent of them are at risk of having to shut down operations, alternatives have been sought urgently.

https://oilprice.com/Energy/Natural-Gas/This-Major-LNG-Exporter-Is-...