Oz LNG Producers To Co-ordinate Outages

LNG producers in Western Australia and the country’s Northern Territory have been authorised to coordinate their maintenance schedules in a move aimed at helping to streamline exports. The length of the approval is half what was sought for and is on a trial basis.

“LNG producers can now schedule maintenance together without risking breaching competition laws, reducing concurrent work at their facilities. This will improve efficiency and maximise LNG production,” the Australian Competition and Consumer Commission’s chairman Rod Sims said March 2.

The authorisation, which is granted for five years rather than the 10-years the LNG producers wanted, comes as the producers compete for a limited number of contractors and equipment.

ACCC chairman Rod Sims said there is significant uncertainty about what impact the conduct will have on related markets and that the watchdog will test the expected benefits and detriments to assess whether it will reauthorise the move in 2023 should the parties seek it.

As part of the authorisation, the ACCC has implemented a condition that requires the producers to publicly disclose maintenance schedule information that they share with each other. It is meant to prevent the players from gaining an advantage in gas trading markets by having knowledge of each other’s facility shutdowns.

The applicants for the authorisation were Japanese Inpex, Anglo-Dutch Shell, Australian Woodside and US Chevron for the Gorgon, Wheatstone, North West Shelf and Pluto LNG facilities in Western Australia, and will include the Prelude LNG facility off the coast of WA and the Ichthys LNG processing facility once they become operational – expected later this year.

One major, ConocoPhillips, the operator of the Darwin LNG facility which liquefies gas from the Timor Sea, did not seek authorisation.