Australian LNG Exports

Keith Kohl

Written By Keith Kohl

Posted May 14, 2014

American oil and gas companies flush with reserves still aren’t allowed to ship their crude oil or natural gas abroad.

Don’t expect this to change too soon, but they have something else they can and are exporting… their expertise.

The North American shale boom has created a slew of companies who know the best and most efficient ways to harvest tight oil and gas reserves. And as the EIA reported last year, there’s 7.299 quadrillion feet of technically recoverable shale gas and 345 billion barrels of shale or tight oil spread across 95 basins in 41 countries.

chart blog 5-14

In other words, there are plenty of countries with considerable shale reserves that would welcome a little technical guidance from the United States.

Australia, for example, holds more than 430 trillion cubic feet of recoverable shale gas reserves. And even though they don’t have the know-how to profitably extract.

Don’t worry, they will soon enough.

Earlier this year, officials from Queensland, Australia opened the Queensland Government North America Trade and Investment Office in Houston, Texas where they will not find a shortage of energy experts.

Now when it comes to shale, Texas is the land of opportunity where the quintessential shale investments are located. We’re talking about plays like the Eagle Ford, Permian Basin, and Barnett shale.

And David Camerlengo, Queensland’s trade commissioner to North America, said on Tuesday that American companies stand to benefit from the huge resource base in Australia.

So, while companies here wait to unlock profits from overseas markets like China, India, and Europe, they can get a head-start by heading down under.

Sure, they might have to give up some of their trade secrets regarding hydraulic fracturing and horizontal drilling, but they’re also poised to gain huge swathes of territory in largely untapped plays…

Then again, I also don’t see these companies being hindered by much red tape from Queensland’s government, which means they can economically export the oil and gas they produce to high-paying Asian markets without having to wait for the U.S. to approve some pipeline or export terminal.

Of course, the initial investment will have to be large, especially if smaller players want to work overseas.

One of the caveats here is that, like anything else having to do with new resource plays, it’s going to take time.

And although Queensland wants to be a major player in LNG shipments by 2017, that goal might be too much of a stretch considering the infrastructure mass exports will require.

Despite the present lack of infrastructure, however, you can bet that the oil deals taking place in Texas will be a common sight in Queensland over the next few years.

Until next time,

Keith Kohl

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