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Australia Looks To Tackle Its Looming Gas Shortage

Australia Looks To Tackle Its Looming Gas Shortage

LNG carrier

In a strange about-face for the world’s soon to be top liquified natural gas (LNG) exporter, Australia is now considering importing the fuel. On Monday, ExxonMobil, Australia’s top gas supplier, said it is considering importing the super-cooled fuel to help offset an anticipated gas shortage from 2021 going forward as well as protecting its market share.

ExxonMobil is also stepping up exploration off the coast of Victoria and considering developing a gas field called West Barracouta close to an existing field, the oil major also said in an emailed statement on Monday.

“Combined with the existing Gippsland resource and infrastructure, an LNG import facility could ensure ExxonMobil can continue to meet our customers’ needs,” the company said, adding that the facility could become operational by around 2022.

Looming gas shortage Down Under

This disclosure comes as Australia struggles with a natural gas shortage, a unique phenomenon for the gas exporting giant. Late last year, the Australian Competition & Consumer Commission and the Australian Energy Market Operator said that gas shortfalls in the country for 2018 and 2019 would be much worse than originally forecasted. They both predicted a shortfall of nearly 110 petajoules of gas in 2018 and similar in 2019, which represents about one-sixth of the projected amount of gas demand in Australia.

In light of this growing problem, late last year Canberra threated to put gas export regulations in place, but the idea has been put on hold as the government and suppliers work out a deal.

However, upping the ante even more, Australia’s energy market operator warned in March that Victoria, the country’s biggest gas consuming state, could face shortages from mid-2021 due to a rapid drop in supply from the Gippsland Basin Joint Venture, owned by ExxonMobil and BHP Billiton, Reuters said in a report. Related: The Fed Is Driving Down Oil Prices

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