An HSBC report suggest that seven new prospects looking for natural gas around Australia will contribute significantly to the nations’ economic growth. So much so, natural gas is predicted to overtake coal as the nation’s second biggest export, behind iron ore.

After years of planning and building, searching and surveying the Liquid Natural Gas (LNG) boom is expected to begin next year. Export volumes are hoped to rise by 70 per cent in 2014/16 and 42 per cent in 17/18.

The amount of natural gas being produced from these rigs will exceed even that of Qatar. This will make Australia the largest LNG exporter in the world.

QCLNG Project in Queensland:

QCLNG Project in Queensland:

However, each of these platforms is largely foreign-owned. So the money flowing into the Australian economy won’t what it could.

The lion’s share of profits will drain back to the mother countries owning the rigs and rights to mine. But some of the money will find its way into Australian coffers through tax revenues. Exporters pay both corporate tax and state royalties, so the governments get their claws in somehow.

The gas is likely headed for markets in China, Japan, Korea, Taiwan and India.

The flagship projects among the seven are predicted to be Australia’s Gorgon project and QCLNG project in Queensland.

What this super-boost in exports means for the domestic price of LNG is still unclear. Should exporters find better prices for their product overseas prices could rise at home to match them. Otherwise supply may be diverted from domestic to international markets, where they fetch the most money.

Gorgon LNG. Image:

Gorgon LNG. Image:

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