Liquefied natural gas (LNG) is simply natural gas in liquid form, which is made by cooling gas.
Coal seam gas (CSG), which is a form of natural gas, can be converted to LNG so that it’s easier to store and transport. This process reduces the gas’s volume 600 times, which is like shrinking a beach ball down to the size of a ping pong ball.
Australia has good reserves of CSG (and other forms of natural gas). In 2013 Australia was the world’s third largest LNG exporter in 2013 behind Qatar and Malaysia1 and is expected to become the world’s largest LNG exporter by 2020.2
Globally, countries look to Australia to buy LNG from for two main reasons:
1. Economic development – energy supports economic growth. In particular, Asia needs readily available energy resources to support development.
2. Environmental reasons – natural gas emits around half the emissions of coal when used to create electricity. Gas is also a clean-burning fuel, which reduces smog and local pollution, both of which pose serious health risks in many developing countries, such as China – a major importer of Australia’s LNG.
“Australia was the world’s third largest LNG exporter in 2013 behind Qatar and Malaysia.”
LNG projects in Australia
More than two-thirds of global investment in LNG is in Australia, where we have two physically separate gas markets: the east and west coasts.
The west coast of Australia began exporting LNG in 1989. Currently, there are three LNG projects operating: the North West Shelf and Pluto projects from the Carnarvon Basin in Western Australia and Darwin LNG in the Northern Territory from the Bonepart Basin.3
On the east coast, three LNG projects are under construction in Queensland and the first export of LNG is estimated to occur in 2014. These projects will pipe the gas from the CSG fields of inland Queensland to Curtis Island, near Gladstone. LNG facilities on Curtis Island will turn the CSG into LNG so it can be exported to Asia.
Origin is part of the Australia Pacific LNG joint venture, which is building a multi-billion dollar CSG to LNG project and helping to create a new export industry on the east coast of Australia.