Platts: East Africa must avoid LNG delays to compete with rivals

Mozambique and Tanzania are locked in a race to be first to export gas from East Africa, so much so that the region may emerge as a strong competitor to Qatar and Australia in the battle to capture key export markets in Asia.

Geographically, East Africa is ideally placed to supply LNG to Japan, China, India and South-East Asia all of whom rely heavily on LNG imports.

LNG from East Africa should be cheaper than from Australia but such an advantage may be wiped out if Mozambique and Tanzania are unable to develop their potential before a glut of other new supplies depress prices.

It took Angola 11 years of preparation and $10 billion to launch LNG exports which began this year, but the plant has been  plagued by technical faults and has yet to reach its full capacity.

Australia should bring on stream Queensland-Curtis, Gladstone and Australia Pacific LNG in 2015 and Gorgon and Wheatsone thereafter, according to energy consultancy Wood MacKenzie.

The US is expected to begin exports of LNG in 2015, with Bernstein Research estimating that annual volumes could reach around 70 billion cubic meters by 2020. Adding to the mix is Russia, the world leader in piped gas but which also has set its sights on LNG, aiming to ramp up exports targeting Asia’s markets later this decade. MORE