Australian liquefied natural gas producers, including Woodside Petroleum, face lower prices when they renegotiate long-term deals with Asian utilities, with new sources of supply such as US exports giving buyers the upper hand in contract talks. 
With the US on track to potentially export 60 million tonnes a year of LNG by 2020, representing nearly a fifth of global supply, Asian buyers will increasingly play hard-ball when existing deals are reworked, according to Citi's New York-based energy analyst Faisel Khan.
"One thing that's for sure is that when these buyers in Asia went into the US to sign these contracts, they knew they were going to break the pricing model," Mr Khan said. "They're very happy they have more competition and more options, and right now all the buyers feel like they are in a very good position."
Mr Khan said pricing for LNG contracts was evolving into a spot market in Asia, although he noted it might take several years for a new mechanism to take shape.
"They're waiting to see where things end up, and for the next few years there will be evolving volatility in how people develop price in the market."
UBS analyst Nik Burns warned that new sources of supply, including US exports, could plague the Asian market for years, weighing on spot LNG prices and putting pressure on producers such as Woodside Petroleum that need to renegotiate sales contracts during that period.
"What we'll start hearing again is, will there be pressure brought to bear on LNG sellers to say, 'Guys, you've got to renegotiate these prices'," Mr Burns said.
He said that of the local Australian producers, Woodside was more exposed than Santos or Origin Energy because it had some three-year contracts for LNG from its $15 billion Pluto project that were set to expire next year and so would soon start looking to renew them.
By 2017, some 27 per cent of Woodside's LNG production is not covered by contracts, rising to 31 per cent in 2019 once some North-West Shelf deals expire, presenting a risk that it will have to accept lower prices than the "extremely attractive" tariffs it announced in early 2014, Mr Burns said.
UBS calculates that if Woodside were forced to settle those contracts at new prices 20 per cent lower than current prices, its valuation on Woodside would be cut by 4.6 per cent.
"That's a key challenge for Woodside that they need to address," Mr Burns said, adding that until now Woodside had been "astute" in its contracting, working in a floor price in several of its sales contracts that protected it from the worst hit from slumping oil prices.