Damon Mcknight
Australia has been a net exporter of energy commodities since at least 2018, with liquefied natural gas (LNG), coal, and minerals among its largest exports. In 2018–19, LNG exports grew by 21%, and by 2021, natural gas made up 29% of the country's energy production. Australia's LNG exports that year were valued at AUD$50 billion, representing about 38% of total energy commodity export earnings.
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What You'll Learn
Australia's energy exports by fuel type
Australia has been a net energy exporter and one of the largest exporters of liquefied natural gas (LNG), coal, and minerals since 2021. LNG exports in 2004 were 7.9 Mt (10.7 bcm), accounting for 6% of world LNG trade. Exports of liquefied natural gas have increased by an average of 13% per year over the past decade. In 2021, natural gas made up a significant component of Australia's energy sector, accounting for 29% of its energy production, 28% of the Total Energy Supply (TES), 19% of electricity generation, and 17% of Total Final Consumption (TFC).
Coal is another important component of Australia's energy sector and energy exports. In 2021, Australia was the world's fifth-largest hard coal producer. Coal represented 64% of domestic energy production, 32% of TES, and 53% of electricity generation. Australia's global anthracite export share was 14% of all production (836 Mt out of 5,990 Mt total).
In addition to LNG and coal exports, Australia also produces and exports renewable energy sources such as solar and wind power. The production of renewable energy in Australia has been increasing, supplying 33% of domestic electricity use in the 2022-23 financial year.
The gas basins with the largest recoverable reserves in Australia are the Carnarvon and Browse basins in Western Australia, the Bonaparte Basin in the Northern Territory, the Gippsland and Otway basins in Victoria, and the Cooper-Eromanga basin in South Australia and Queensland.
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Coal exports
Australia has vast resources of coal, and coal mining occurs in nearly every state. In 2019-20, Australia exported 390 Mt of coal (177 Mt metallurgical coal and 213 Mt thermal coal) and was the world's largest exporter of metallurgical coal and the second-largest exporter of thermal coal. About 70% of coal mined in Australia is exported, mostly to Eastern Asia, and the rest is used in electricity generation. In 2013, 77% of production was exported, and in 2009, the figure was 78%. In 2019, Australia earned $63.9 billion from black coal.
Australia's coal exports to India declined by 11% in 2023, and its market share in India dropped from 81% in 2018 to 59% in 2024. In 2023, coal export volumes to South Korea and Taiwan fell by 24% and 11%, respectively, as these countries are increasingly moving away from coal and towards renewable energy sources and nuclear power. In the first half of 2024, Vietnam, another significant market for Australian coal, imported 25% less coal from Australia than in 2022, with market share lost primarily to Indonesia.
Despite the criticism and the decline in exports to some countries, coal remains important to Australia's energy sector. In 2021, coal accounted for 64% of energy production and 32% of the Total Energy Supply (TES). In 2022-23, 89% of black coal energy production was exported.
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Natural gas exports
Australia has substantial natural gas resources, with the largest deposits located offshore. In 2021, natural gas made up a significant component of Australia's energy sector, accounting for 29% of its energy production, 28% of the Total Energy Supply (TES), 19% of electricity generation, and 17% of Total Final Consumption (TFC).
In 2019-20, about 74% of Australian-produced natural gas was exported as liquefied natural gas (LNG). LNG exports from Australia have increased by an average of 13-17% per year over the past decade, with several new facilities commencing production. Australia recently overtook Qatar to become the world's largest exporter of LNG, exporting around 80-81.2 million tonnes per year.
The dramatic expansion of LNG production and export is a major factor driving current and future emissions growth. The extraction, transportation, and burning of natural gas release greenhouse gases, particularly carbon dioxide and methane. Australia's LNG exports have more than offset any reduction in emissions from the rollout of wind and solar generation.
To meet the increasing demand for LNG exports, there is a growing dependence on unconventional gas sources, such as coal seam gas (CSG) and shale gas, which are more costly and environmentally damaging to develop and use. As a result, there are concerns about the impact of Australia's LNG exports on global temperature rise and climate change.
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Oil imports
Australia is a net exporter of energy, including coal and natural gas. In 2022-23, net exports of energy made up over two-thirds of production. However, Australia is a net importer of oil products, with oil imports rising from 7% of total consumption in 2000 to 39% in 2006. Australia's oil production peaked in 2000, and the country now imports almost all of its oil. In 2016, Australia imported 8% of its oil consumption, or 86,930 barrels per day.
Australian refineries import around 83% of the crude oil they process from more than 17 countries, mainly in Asia (40%), Africa (18%), and the Middle East (17%). The largest recipients of Australia's exported crude oil are Indonesia and Singapore. Australia's imports of refined petroleum from overseas are increasing as its local production declines. In 2021, oil accounted for 52% of Total Final Consumption (TFC) and 32% of the Total Energy Supply (TES).
Australia's liquid fuel reserves are relatively low compared to stockpiles of other goods, and the country could face serious consequences in the event of a disruption to its oil imports. Australia's geographically dispersed oil supply chains mean there are several places where they could be disrupted. For example, the ongoing tensions in the South China Sea threaten Australia's major oil supply route through the Strait of Hormuz, the only sea passage out of the Persian Gulf through which more than 40% of the world's oil passes.
While oil is often described as a "fungible commodity", meaning that oil from different suppliers is interchangeable, the point at which a supply is disrupted is important. For instance, Australia's fuel ports are particularly vulnerable to disruption. Australia's fuel supply routes are also threatened by the potential for radicalised Indonesians returning home from the Islamic State group in Iraq and Syria to continue the fight.
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Renewable energy production
Australia is a significant exporter of energy, including coal, natural gas, and minerals. In 2021, Australia was the world's fifth-largest producer of hard coal, and coal exports accounted for 31% of global exports. The country also has vast reserves of coal seam methane (CSM) and liquefied natural gas (LNG), with LNG exports increasing by 21% in 2018-19. In 2022-23, around 89% of black coal energy production, 73% of domestic natural gas production, and 97% of crude oil production were exported.
Despite being a major exporter of fossil fuels, Australia is not immune to the global shift towards renewable energy sources. In 2022, renewable energy sources, including solar, wind, and hydropower, accounted for 39.4% of Australia's total electricity generation, a significant increase from the previous year's 26%. The expansion of renewable electricity generation has been driven primarily by solar and wind power, with small-scale solar generation growing by 17% in 2023 and wind generation increasing by 6%. Large-scale solar generation has also seen rapid expansion, growing from negligible levels before 2016 to 6% of all Australian electricity generation in 2023.
The Australian government has taken steps to encourage the adoption of renewable energy technologies. The Solar Sunshot program, announced in March 2024, is a $1 billion fund that provides grants and production credits to manufacturers of solar panels, with the goal of increasing domestic production. Additionally, the Australian Energy Resource Assessment provides a detailed review of the country's renewable energy resources and technologies for extraction, helping to guide future energy policies and investments.
Some Australian states have set ambitious targets for renewable energy adoption. For example, South Australia aims to achieve 100% net renewables by 2030 and become a net exporter of renewable energy. Tasmania has already achieved its goal of 100% renewable energy by 2022, and it now targets 200% renewable energy by 2040. The Northern Territory has committed to a target of 50% renewable energy by 2030. These targets and initiatives demonstrate Australia's recognition of the importance of transitioning to renewable energy sources and reducing the country's carbon footprint.
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Frequently asked questions
Yes, Australia is a net exporter of energy.
Australia is one of the largest exporters of liquefied natural gas (LNG), coal, and minerals.
LNG exports make up 6% of world LNG trade. In 2018-19, LNG exports made up 38% of total energy commodity export earnings.
Australia was the world's fifth-largest hard coal producer in 2021. Coal made up 64% of domestic energy production.
In 2021, natural gas made up 29% of Australia's energy production.
