Australia sends LNG cargoes to Chile for first time in over three years

Two Australian liquefied natural gas cargoes are sailing to Chile in what would be the South American country's first shipments from that origin in over three years, according to ship-tracking data.

More cargoes going towards the Atlantic versus the Pacific would increase competition between the two basins and could tighten supply and support spot LNG prices in the region.

According to data from analytics firm Kpler, the Gaslog Gladstone tanker loaded a cargo at the Queensland Curtis LNG (QCLNG) terminal on January 27 and is expected to arrive at Quintero, Chile, on February 14. Another tanker, Barcelona Knutsen, also picked up a cargo at QCLNG on February 5 and is set to arrive at Mejillones, Chile, on February 27.

Australian LNG cargoes do not typically head to South America due to the distance and freight economics, making the US Gulf Coast or Atlantic basin supply more competitive for Chile and neighbouring markets, said Go Katayama, principal insight analyst at Kpler.

"The movements...appear to reflect tightness in the Atlantic Basin and relative price dynamics, which can temporarily open arbitrage opportunities for Pacific-sourced cargoes," he said.