A stranded Chinese LNG tanker is causing disruptions at one of Australia’s export terminals, drawing attention from the global energy markets. Origin Energy, Australia’s upstream producer, has announced a reduction in production to mitigate the impact of the stranded vessel, CESI Qingdao, owned by a Chinese energy company, Sinopec. The vessel experienced a propulsion failure on November 21 while loading at the terminal on Curtis Island near Gladstone, Australia, operated by ConocoPhillips as part of Australia Pacific LNG.
CESI Qingdao, a regular caller at the terminal, is crucial for a dedicated export operation under a long-term time charter with Sinopec. The vessel’s power loss, described as a “propulsion failure” by the owners and a generator issue by the Australian Maritime Safety Authority, has left it unable to leave the terminal. Origin reported a temporary halt in cargo loading until the situation is resolved.
Australia Pacific LNG, a major producer and exporter with an annual capacity of 9 million metric tons, faces challenges as the terminal only has one dock. Two shipments have already been deferred, and three LNG tankers are currently anchored off Gladstone awaiting resolution. Origin expects more LNG cargoes to be deferred, contingent on the timeframe for resolving the situation.
An agreement was reached on December 1 to tow the disabled tanker to a secure anchorage for repairs, involving Gladstone Ports, Marine Safety Queensland, and the Australian Maritime Safety Authority. While three cargoes were deferred during the blockade, Origin plans to ramp up production to normal levels. The disruption comes amid increased LNG demand during the colder weather season in China and Japan.
