China looks to Curtis Island for LNG boost
CHINESE companies are taking advantage of financial investment in Curtis Island liquefied natural gas plants, increasing imports from the sites this year.
The latest report from gas analysts EnergyQuest said China was closing the gap as Australia's second largest buyer of LNG, buying 36 per cent of Australian LNG exports last year.
Exports from the $70-billion Curtis Island plants - APLNG, GLNG and QCLNG - made up 57 per cent of Australian LNG exports shipped to China.
"Chinese companies have made huge investments in Queensland LNG and Queensland alone supplied a massive 27 per cent of all China's LNG imports," it said.
The three major state-owned Chinese oil and gas companies - CNOOC, Sinopec and PetroChina - have significant investments in Queensland gas: CNOOC in QCLNG, Sinopec in APLNG and PetroChina in Arrow Energy.
EnergyQuest chief executive Graeme Bethune cautioned the Australian Government against triggering export bans or controls, previously threatened on the Curtis Island plants, in light of China's interests in Queensland LNG.
Export bans or restrictions on Curtis Island plants are possible under the Australian Domestic Gas Supply Mechanism, if there is a need for more supply for the domestic market.
"This international dimension is rarely acknowledged in domestic discussions about policy options to increase East Coast supply," Mr Bethune said.
"With Australia's relations with China at a low ebb, any moves by the Federal Government to trigger the ADGSM or introduce domestic gas reservation will have to be handled with great sensitivity."
The report said the United States was expected to be a major supplier to China but that did not eventuate due to current trade tensions.
The warning comes as fallout continues from Liberal MP Andrew Hastie's remarks comparing the west's response to China to inadequate defences against Nazi Germany.
Last year China surpassed Japan as the world's largest importer of natural gas and in January it announced plans to increase its LNG intake fourfold during the next 20 years.
Meanwhile the report also found Curtis Island LNG exporters shipped 25 cargoes last month, down from 27 in June.
It said the three sites last month operated at 79 per cent nameplate capacity.
APLNG shipped 10 cargoes, QCLNG nine and GLNG six.