Australian LNG Faces Stiff Competition from East African Supplies
Liquefied natural gas exports from Australia is beginning to face stiff competition from oil and gas exploration companies in East Africa amid the whopping 24 oil discoveries made from just only 27 test wells there.
International Business Times citing a report from The Australian said offshore wells in Tanzania and Mozambique had experienced extraordinary exploration success, with 100 trillion cubic feet of recoverable gas reserves discovered since mid-2010. Oil and gas exploration companies in East Africa even said there is the potential to double that figure.
While Australia currently exports 25 million tonnes of LNG per year, East Africa was reported to plan exporting 36 million tonnes annually.
"East Africa has been touted as the next major theme in global LNG supply, given the size of the resources and lack of local gas demand," John Hirjee, energy analyst from Deutsche Bank, was quoted as saying by The Australian.
It is not remote that East Africa could overtake Australia as one of the world's biggest LNG hubs, apart from Qatar, since LNG consumers would naturally and continuously scout for other supply options.
"The search for diversity favoured recent Australian developments as an alternative to over-reliance on the Middle East," Hirjee said.
"However, with Australia now set to be the world's largest LNG supplier by about 2017, East Africa offers a new source of supply to risk-averse LNG buyers."