LNG Will fuel the second gas revolution
By 2040, the International Energy Agency forecasts energy demand to increase by 30%, with natural gas demand growing by 50%.
Based on its mobile nature, LNG will facilitate the global integration of gas markets as supply sources increase.
- The LNG market is currently over-supplied, but a supply shortage is expected from mid 2020 due to global demand growth and delays in investment in new projects.
- As LNG projects typically take ≈ ten years to bring online (four to five years to engineer and an additional five to six years to construct), new projects need to progress now to take advantage of this expected shortage for capturing the upside.
Our Opportunity - 15+ target resources with USD 20 billion worth of gas to unlock
In Australia, there are approximately 40 discovered but stranded gas resources ranging in size from ~0.5 to 5.0 Trillion Cubic Feet (TCF), representing 65 TCF and 25% of Australia's total identified gas resources.
Globally (excluding opportunities in Australia), there are approximately 200 of such stranded gas resources, totalling 260 TCF.
Owners of these stranded gas resources are challenged to monetisation these due to issues such as
- Lack of materiality in their oil and gas portfolio
- Remote location
- Lack of a low-cost development concept
While each of these gas fields may differ in value due to varying degree of resource maturation, monetisation of these represent an approximate market value of ~USD 65 billion* in Australia and an additional value of ~USD 260 billion* outside Australia that remain to be unlocked.
* Market Value = TCF gas volumes x USD 1 / MCF. Historical transaction prices of oil & gas resources sold in Australia upon FID that are bound to be LNG projects indicate market value range of ≈ USD 0.8 to 1.6 per MCF