Australia is now one of the world’s largest exporters of liquefied natural gas (LNG), with an estimated value of over $50 billion in 2018–19. However, the cost of producing LNG in Australia is nearly twice that of comparable countries.
There are multiple reasons for the high production cost of Australian LNG, including remote resource locations and a relatively small population.
However, the risks of testing unproven solutions at a commercial scale within the LNG sector have contributed to persistent underinvestment in research and development, a slow rate of new technology adoption and a reliance on overseas technology providers, potentially stifling domestic innovation.
The 2019 Australian Infrastructure Audit found that Australia could provide global leadership and innovation in the energy sector by leveraging its natural resources and high-quality research institutions.
The proposal is for a national facility to develop and test new technologies with the potential to improve operational performance, as well as potentially increase process reliability and reduce production costs.
These improvements could have a range of benefits, including reducing methane emissions, increasing helium recovery and sales, and accelerating workforce training conducted in a live environment.
The facility would operate through a cooperative research centre, with potential opportunities for open-access to subject matter experts.
The proposed scope of the facility also includes a hydrogen production plant component, reflecting the strategic opportunity for hydrogen as an alternative energy source and export industry for Australia as indicated in the 2021 Australian Infrastructure Plan and as separately identified on the Infrastructure Priority List.
Proponent to identify and analyse potential investment options (Stage 2 of Infrastructure Australia’s Assessment Framework).