No impact on LNG exports after tropical cyclone brushes past Western Australia

LNG exports from Western Australia have not been impacted so far after cyclone Sean forced the northern ports in the state to close over the weekend Jan. 18-19 as a precautionary measure, according to market participants.

The ports of Port Hedland, Dampier and Cape Preston West resumed operations following their closure Jan. 18 due to cyclone risk, operator Pilbara Ports Authority said Jan. 20.

Australia's Bureau of Meteorology had issued warnings for sections of the Pilabara coast in the north due to tropical cyclone Sean brushing past the region, including areas such as Barrow Island and Karratha.

Some of Australia's largest LNG projects including Wheatstone LNG, Gorgon LNG, Pluto LNG and North West Shelf LNG are clustered along the northern coast of Western Australia.

"Woodside does not comment on day-to-day operational matters," a Woodside spokesperson said, when asked about the cyclone impact on NWS LNG shipments. Osaka Gas does not see any immediate impact from the cyclone as it has sufficient LNG inventories, a company spokesperson said.

There were no LNG carriers berthed at the Woodside-operated NWS LNG project, according to S&P Global Commodities at Sea(opens in a new tab). The BP-chartered BW Helios and the Osaka Gas-chartered LNG Jupiter are currently located off the coast with loadings scheduled this week, according to CAS.

LNG carrier arrivals and LNG terminal activities are usually suspended for a few days in the event of cyclones or other extreme weather events. This is mainly a precautionary safety measure and operations are allowed to resume after a damage assessment.

Platts assessed JKM -- the benchmark price for cargo delivered to Northeast Asia -- for March at $13.617/MMBtu on Jan. 17, indicating an increase of 22 cents/MMBtu or 1.6% from the previous assessment, Commodity Insights data showed.

"Tropical Cyclone Sean will continue moving west this morning, parallel to the Pilbara coast and strengthen before turning to the southwest and move away from the coast," the weather bureau said.

"Pilbara Ports has resumed operations at the Port of Port Hedland," it added. "Pilbara Ports will resume operations at the ports of Dampier and Cape Preston West from 12:00 [pm] Australian Western Standard Time," the bureau said in a separate notification.

Although the cyclone continued to bring gales and heavy rain to the western Pilbara coast, conditions are expected to improve as it moves away from the coast, the bureau said Jan. 20.

The bureau has advised caution in certain parts of the country as the "the cyclone continues to intensify and [is] forecast to reach Category 4 later today [Jan. 20]."