Shell anticipates that its LNG supplies from Australia will assist in meeting the demand from rising markets in south and southeast Asia, which are predicted to take up a portion of the increase in global LNG supply by the end of this decade.

Asia’s spot LNG prices surged last week to levels not seen since January as the region’s scorching temperatures increased demand for the ultra-cold fuel.

On the fringes of the Australian Energy Producers Conference on Wednesday, Cecile Wake, Country Chair at Shell Australia, told Reuters that “that combination of decarbonisation, and declining domestic production (will drive LNG demand growth)”.

Wake anticipates that important demand growth markets will include Bangladesh, Thailand, Vietnam, and the Philippines.

“I believe we refer to it as latent demand in South and Southeast Asia,” stated Wake, who also mentioned that this year’s global LNG markets were “finely balanced.”

Wake explained Shell’s substantial commitment to the Australian market as the result of an internal evaluation of demand forecasts in Asia.

“We see ourselves competitively positioned to Asian markets. It is about maintaining that supply position, ensuring that we’ve got high utilisation, high reliability of our LNG assets here,” she stated.

Wake expressed Shell’s satisfaction with the way its flagship floating LNG project, Prelude, emerged from Australia’s mandatory closure.

Prelude was the world’s first floating LNG facility, with a deck that extends over four soccer fields and an estimated cost of over $12 billion. Since it began operations in June 2019, it has had a number of disruptions, including a fire in December 2021 that resulted in a total loss of electricity.

However, due to delays in the shutdown of certain coal-fired power facilities, discussions were being made with organisations sponsoring the nation’s decarbonisation efforts, according to the CEO of state utility Eskom on Tuesday, May 21.

“The volumes this year are of course anticipated to be higher than last year because it doesn’t have a statutory turnaround. It has come out of that statutory shutdown with both higher reliability and a much tighter band of where we think the performance range is,” Wake said.

“There’s no major statutory shutdowns this year or next. The next major shutdown will not be until 2026, at this stage,” she said.

(Adapted from NewsBreak.com)

Categories: Economy & Finance, Strategy, Sustainability, Uncategorized