{"id":790030,"date":"2026-07-09T21:45:18","date_gmt":"2026-07-09T21:45:18","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/790030\/"},"modified":"2026-07-09T21:45:18","modified_gmt":"2026-07-09T21:45:18","slug":"national-gas-reservation-scheme-aplng-and-shell-push-for-equitable-rules-as-tensions-rise-over-potential-carve-outs","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/790030\/","title":{"rendered":"National gas reservation scheme: APLNG and Shell push for equitable rules as tensions rise over potential carve-outs"},"content":{"rendered":"

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Tensions are flaring ahead of the launch of Labor\u2019s national gas reservation scheme, as eastern Australia\u2019s largest gas producer calls on the government to reject rivals\u2019 requests for \u201cleave passes\u201d from the policy.<\/p>\n

In a yet-to-be-released submission to federal reservation rules obtained by this masthead, Australia Pacific LNG (APLNG) broke ranks with the Queensland government as well as industry voices, including the fossil fuel lobby, to double down on the need to establish an east coast reserve.<\/p>\n

\"MostMost of Australia\u2019s LNG is produced in Queensland or Western Australia, and is sold on long-term contracts to Asia.Bloomberg<\/p>\n

APLNG<\/a> \u2013 a joint venture between Australia\u2019s Origin Energy, US giant ConocoPhillips and China\u2019s Sinopec \u2013 was joined by global energy company Shell<\/a> in supporting new domestic supply commitments, including rules compelling it to set aside a specified amount of gas that cannot be sold overseas and must be delivered locally.<\/p>\n

But the reservation scheme, proposed to set aside 20 per cent of exports from 2027 for domestic use, has been staunchly opposed by other east coast gas producers, which warn it threatens to kill investment in future sources of gas supply and could imperil trade ties with Australia\u2019s major Asian partners.<\/p>\n

The federal government\u2019s proposed scheme does not include a formal carve-out for Santos\u2019 GLNG, but it is believed the policy\u2019s ministerial powers to approve alternative supply arrangements could benefit the company\u2019s Gladstone operations by either temporarily exempting it from the scheme or deferring its contributions into the 2030s when its existing LNG export contracts begin rolling off.<\/p>\n

Related Article\"Australia<\/a><\/p>\n

APLNG strongly contests this, however, arguing it is crucial the rules are applied equally.<\/p>\n

\u201cFor a domestic gas reservation framework to work it must apply equitably to each of the three east coast exporters and treat investors and Australia\u2019s trade partners equally,\u201d it wrote in its submission.<\/p>\n

\u201cAny framework that departs from the national interest and provides favourable treatment, a carve-out, or an effective leave pass to one set of trading partners or an individual company will fail to deliver.<\/p>\n

\u201cWhile APLNG remains committed to do our part to reserve gas for Australia, we will not support further, ongoing interventions that make our investors and trade partners effectively pay for the costs of meeting reservation obligations for another business that is both not contributing and taking gas back out of the Australian market.\u201d<\/p>\n

\"APLNGAPLNG has doubled down on its position on the gas reserve as long as the rules are equal.<\/p>\n

The majority of Queensland\u2019s gas is locked into long-term export deals and sold as LNG to buyers in Asia while APLNG and the Shell-backed QCLNG joint venture near Gladstone together provide about 40 per cent of the east coast domestic market. However, the Santos-backed GLNG business, the state\u2019s third gas exporter, is a net withdrawer of domestic gas to meet its export commitments.<\/p>\n

Grattan Institute energy policy expert Tony Wood echoed the need for consistency in supply contributions if the proposed reservation scheme was to work.<\/p>\n

He said while it was true Santos GLNG may not have surplus gas at its ventures in Queensland, the energy giant could source sufficient supply to meet its contributions to the domestic market.<\/p>\n

\u201cYou don\u2019t give them a variation, you insist they have a firm obligation to supply and they can get gas wherever they like,\u201d Wood told this masthead.<\/p>\n

\"TheThe Queensland government called on the reservation scheme to be deferred.Jamila Filippone<\/p>\n

\u201cThat includes both getting gas from the other two or doing a deal with, say Beach [Energy] or someone like that, to develop some more gas.\u201d<\/p>\n

Australian Workers\u2019 Union national boss Paul Farrow agreed, saying any carve-outs for exporters will fail.<\/p>\n

\u201cOne set of rules needs to apply firmly and needs to apply to all. The guiding principle of gas reservation is very simple and should not be corrupted: if you want to extract Australia\u2019s gas \u2013 our sovereign wealth \u2013 you have a responsibility to offer a defined portion of that gas to Australians,\u201d he said.<\/p>\n

\u201cNo dodgy leave passes, no exceptions.\u201d<\/p>\n

The Queensland government\u2019s submission, also seen by this masthead, called on the federal government to defer the reservation scheme.<\/p>\n

It described the proposed 20 per cent of all LNG exports to be supplied to the domestic market as a \u201csignificant intervention\u201d.<\/p>\n

\u201cThe objective of deliberately oversupplying the domestic market with otherwise exportable gas will negatively impact investment signals and undermine the long-term supply response needed to sustain gas production,\u201d according to the state\u2019s submission.<\/p>\n

\u201cThese risks are material and fall disproportionately on Queensland and Queensland producers.\u201d<\/p>\n

Start the day with a summary of the day\u2019s most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter<\/a>.<\/p>\n

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\"JamesJames Hall<\/a> is the News Director at the Brisbane Times. He is the former Queensland correspondent at The Australian Financial Review and has reported for a range of mastheads across the country, specialising on political and finance reporting.Connect via X<\/a> or email<\/a>.From our partners<\/p>\n","protected":false},"excerpt":{"rendered":"Save You have reached your maximum number of saved items. Remove items from your saved list to add…\n","protected":false},"author":2,"featured_media":331872,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22],"tags":[64,63,75,128],"class_list":["post-790030","post","type-post","status-publish","format-standard","has-post-thumbnail","category-environment","tag-au","tag-australia","tag-environment","tag-science"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/790030","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=790030"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/790030\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/331872"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=790030"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=790030"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=790030"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}