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Australia's LNG exports face competition from U.S.
by Staff Writers
Sydney (UPI) Feb 27, 2013


The United States is emerging as a major competitor to Australia's gas export market, says a former U.S. Department of Energy official.

Speaking at the Australian Domestic Gas conference Wednesday in Sydney, Randa Fahmy Hudome, who was appointed by President George W. Bush to serve as the U.S. associate deputy secretary of energy, said the United States viewed Asia as its biggest market and was increasing liquefied natural gas export approvals to fill future demand from that region, The Australian newspaper reports.

Hudome now heads up a Washington, D.C.-based government relations and strategic consulting firm she launched in 2003.

"In the U.S. we see the demand in Asia as the biggest bite of the apple for us. We intend to compete in that market," she said.

Earlier this month, the U.S. Department of Energy conditionally authorized approved Cameron LNG, LLC to export domestically produced LNG from a terminal in Cameron Parish, La., to countries that don't have a U.S.-free trade agreement, such as India and Japan.

Japan is currently the world's largest LNG importer.

Cameron is the sixth such project in the US to receive approval since 2011.

"We have a very helpful regulatory environment," the newspaper quoted Hudome as saying.

While Australia has been slated to overtake Qatar as the world's biggest LNG exporter by 2030, Australia's LNG sector has been plagued by rising labor costs, infrastructure bottlenecks and the strong Australian dollar.

"We are looking carefully at Australia's ongoing LNG projects -- are they too big, cost prohibitive? And what kind of policies will your government implement? Will they help, or will they hinder your production?" Hudome said.

"In Australia you have a saying, 'no worries mate,' well I would say 'be worried mate' because the U.S. is coming at you full steam ahead, and I say let's have a healthy competition on this going into 2020."

But Australian Petroleum Production and Exploration Association chief executive David Byers, who also spoke at the conference, pointed out that Australia had a head start in the LNG sector.

"Yes, the Americans are coming but we got there first; we have projects that are under way now," he said, noting that Australia had three major LNG plants in operation and seven under construction.

Takashi Yoshida, director general of government-owned Japan Oil, Gas and Metals National Corporation, another speaker at the conference, said that although Australia has become the biggest LNG supplier to Japan, "Japanese industries have a strong interest in LNG imports from the U.S."

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