The nation's three biggest east-coast gas exporters have held an emergency meeting to discuss boosting domestic supplies following the ministerial threats of unprecedented export controls NickToscano1 micksfoley
Australia’s three largest east-coast gas exporters have held an emergency meeting to discuss boosting domestic supplies after federal Resources Minister Madeleine King threatened unprecedented export controls if the industry fails to act first.
In its latest report, the Australian Competition and Consumer Commission said a shortage of 56 petajoules was now expected in 2023, equivalent to 10 per cent of domestic demand. The shortfall is the largest since the ACCC began its inquiry into the east-coast gas market in 2017, and has intensified its warnings over rising costs for households with gas heaters and gas-reliant manufacturers that are already struggling to remain viable.
The higher prices are driving record sales revenue for some of Australia’s largest oil, gas and coal producers, but have disrupted Australia’s domestic energy markets, causing economic pain for business, such as manufacturing plants, which rely on gas for energy or as a raw material.The ACCC on Monday said LNG exporters were contributing to the forecast 56-petajoule shortfall in 2023 by withdrawing 58 petajoules more gas from the domestic market than they expected to supply.
A spokeswoman for APLNG, which the ACCC report noted was a “net contributor” to the east-coast gas market, urged governments to give greater attention to developing new sources of gas supply in southern states such as Victoria and NSW that need the fuel the most. The Energy Users’ Association of Australia, whose members include ASX-listed fertiliser giant Incitec Pivot and building material supplier Brickworks, backed the decision to initiate the first steps of the gas security mechanism, but feared it would “not be enough”.
While Australia is one of the world’s top gas exporters, massive amounts are locked in to contracts to be sold to overseas buyers, or are in faraway parts of the country where it is expensive or impossible to supply demand centres in the south. Victoria’s offshore gas fields in the Bass Strait, which have traditionally supplied up to half of the eastern seaboard’s gas demand, remain in rapid decline.
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