Australia Pacific LNG Sells Additional 41 PJ of Gas to Domestic Market

Australian LNG exporter Australia Pacific LNG has sold an additional 41 PJ of gas to the east coast domestic market through an agreement with 37.5% stake holder in the project Origin Energy, APLNG said October 26.

The deal, which follows pressure from the federal government to shore up domestic supplies, is a 14-month contract which starts November 1 and comprises 4 PJ in 2017, and 37 PJ in 2018, it said.

“This new contract increases APLNG’s total domestic contracted supply commitment for 2018 to over 186 PJ. This represents almost 30% of Australian east coast domestic gas market demand, up from 20% in 2017,” the company said.

In its full fiscal year results released August 16, Origin said the guidance range for APLNG’s domestic contracted volumes for fiscal 2017-2018 (July-June) is 181 PJ, with an additional 75 PJ set aside for sales to either the spot LNG or domestic markets. Its contracted LNG volumes guidance for the period was set at 433 PJ.

“We are very pleased to have been able to supply this significant additional volume of gas to the Australian domestic market, and we are actively working on more domestic gas sales,” APLNG CEO Warwick King said.

Origin executive general manager of energy supply and operations, Greg Jarvis, said the agreement demonstrates the Origin’s commitment to bring more supply to help meet the needs of the domestic market.

“East coast LNG producers including APLNG have committed to divert more gas to the domestic market to avoid any potential gas shortfall, and this agreement shows Origin’s determination to be part of the solution to get more gas to Australia customers,” he said.

Last month, the Australian Energy Market Operator warned that the region faces a projected gas shortfall risk for 2018 of between 54 PJ to 107 PJ and between 48 PJ and 102 PJ for 2019. 

Nathan Richardson