Key gas observations for the month ending 15 May 2019:
Average gas demand from Curtis Island for the month was 3,714TJ/day which was marginally above the Q119 demand which was a record high at 3,657TJ/day (AEMO Quarterly Dynamics – Q1 2019).
Santos reported it had signed Memorandums Of Understanding (MOU) with Brickworks and Weston Energy for Narrabri gas during the month. The arrangements have pencilled in 3PJ/annum for seven years for Brickworks and 10PJ/annum for ten years for Weston Energy with supply beginning post 2023. Kevin Gallagher made comment saying “We have committed 100 percent of Narrabri gas to the domestic market”.
NEM electricity demand softened relative to month prior and consequently we saw a decline in generation; gas generation reduced by 9%.
The historical LNG netback price according to the ACCC was AUD$5.46/GJ. This is the lowest price since June 2016 (ACCC, Gas Inquiry 2017-2020, May 2019). The forward price however slowly moves up between now and September, and then as winter hits parts of the northern hemisphere it increases quickly.