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Australia 'puts the gas down' to end 40-year deficit – Morgan Stanley

Published time: December 16, 2013 11:56
A handout photo obtained on July 18, 2012 shows Woodside Energy Ltd's LNG (liquefied natural gas) tanker at the Karratha gas plant loading terminal in the north of Western Australia. (AFP Photo)

A handout photo obtained on July 18, 2012 shows Woodside Energy Ltd's LNG (liquefied natural gas) tanker at the Karratha gas plant loading terminal in the north of Western Australia. (AFP Photo)

Morgan Stanley says Australia will become the world’s biggest liquefied natural gas (LNG) exporter by 2017. This will help the country end 40 years of current account deficits.

“Liquefied natural gas (LNG) exports from Australia could be the next big thing,” The Telegraph cites the report as saying.

According to the research, the county is expected to experience a “huge ramp-up” in LNG output, pushing Australia to top of the list of LNG exporters, leaving Qatar behind by 2017. That pace of development, coupled with coal exports, will make the country a major force in global energy production.

“The ramp-up would be enough to see Australia record a current account surplus in 2015, the first since the second quarter of 1975. It is difficult to overestimate the long-term structural importance of this industry to Australia,” said the bank’s East Asia expert Geoffrey Kendrick.

Australia faces a current account deficit of about 5 percent of gross domestic product; LNG development will see a remarkable shift in the national economy.

Currently Australia accounts for two-thirds of the total global LNG trade increase. While the so-called "shale revolution" has seen a boom in US gas production, Australia still needs 5 to 10 years to establish infrastructure and export terminals. That gives it an advantage to strengthen its positions on the global energy market.

One of the most lucrative of Australia’s potential customers is Japan. After the Fukushima disaster, the country was forced to rely on more traditional energy sources such as gas. The price there is about $19 per British thermal unit (BTU), which is more than 4 times more expensive than in the US, where gas costs $4.3 per unit.

According to Morgan Stanley estimates, Australian share of gas exports will go from 20 percent to 22 percent by 2016.

Comments (11)


Enrique 17.12.2013 10:08

I have read about an initiative to make a new state in Northern Queensland with capital in Townswille. 80% of Australia´s population is based on the South East (Adelaide-Brisbane-M elbourne Triangle), with a combined population of 18 million people)

Note that Sydney is at the same same distance from China as Athens (Greece), so Australia needs a new Northern state.

An open window to the Asian markets and to the Trans-Continental trade routes, as already has been proposed (trade route India-Panama-Europe, for example)


Enrique 17.12.2013 10:01

Alan Cameron 16.12.2013 22:24

Re Enrique's comment: It's hard to see Australia ever competing as a successful manufacturer because of it's small population and it is spread out over long distances. The country could do a lot better though, considering the resources available to it...maybe import some Norwegian politicians and technically qualified Germans!


Alan, the population of Australia is similar to Taiwan and four times bigger than Singapore, both with a large manufacturing base.
As for the long distances, new factories for export could placed in the North of Australia as free port.


Divided States Of America 17.12.2013 08:58

In Fact, Mining companies are allowed to use river water that is mixed with lethal chemicals such as Sodium Cyanide before that water goes BACK in to the river system that many major country towns use for drinking water.
Australia n government says, That's okay. Australians are completely oblivious!

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