Australia is set to issue a gas market review that could curb exports of liquefied natural gas from its east coast, where three operators led by firms such as Shell\u00a0and Santos send cargoes to Asia and beyond.\n<\/p>\n
The review, which industry watchers expect Canberra to release as soon as this week, could include a policy for local supply to be prioritized by LNG exporters in the populous east, the main source of domestic demand, they said.\n<\/p>\n
\u201cThe government\u2019s trying to solve a tricky problem, because they want\u2026 a situation where the domestic market and the international market are both met with\u2026 gas that is reasonably priced,\u201d said Tony Wood, an energy analyst at the Grattan Institute in Melbourne.<\/p>\n
The review is likely to be a framework, with detailed measures expected in early 2026, industry sources said, speaking on condition of anonymity.\n<\/p>\n
While all three consortia could be affected, industry observers said Gladstone LNG (GLNG), operated by Santos and backed by South Korea\u2019s Kogas,\u00a0TotalEnergies\u00a0and Malaysia\u2019s\u00a0Petronas\u00a0may face the toughest scrutiny.\n<\/p>\n
GLNG has relied heavily on third-party domestic gas to meet export commitments, taking large volumes from the local market to fill contracts its own coal seam gas fields cannot supply, and has argued that any new domestic gas commitments would \u201ccompletely undermine\u201d its contracts.\n<\/p>\n
The other two eastern exporters, Australia Pacific LNG (APLNG), led by Origin Energy with\u00a0ConocoPhillips\u00a0and Sinopec, and Queensland Curtis LNG (QCLNG), led by Shell with partners\u00a0CNOOC\u00a0and Tokyo Gas, have met contracts with supply from their own fields and sold surplus gas as spot cargoes or in the domestic market.\n<\/p>\n
Both have called for the three eastern producers to contribute equally to the domestic market, until new gas sources come online.\n<\/p>\n
\u201cIn the longer term, targeted investment in gas field development near demand centres is critical to ensure supply security,\u201d APLNG said in an August submission to the review.\n<\/p>\n
The Labor government has pledged to honour existing contracts, but in August Shell criticised the approach for uncontracted volumes from its facility and APLNG to serve as a backstop for what it called systemic supply failures in southern states.\n<\/p>\n
\u201cA simpler model for reservation\u2026 will strengthen the domestic market, support a vibrant export industry and encourage future investment,\u201d Shell said in a statement sent to Reuters.<\/p>\n
Such a model would be underpinned by active measures to increase supply, rather than the current rules that focus only on uncontracted volumes, it added.\n<\/p>\n
GLNG did not immediately respond to a request for comment.\n<\/p>\n
Projects in the west and north of Australia, the world\u2019s third-largest LNG exporter, are not affected by the review.\n<\/p>\n
EXPORT AND PRICE CONTROLS\n<\/p>\n
Australia\u2019s east coast LNG industry is built around Queensland coal seam gas fields and six export trains at Gladstone.\n<\/p>\n
Since exports began in 2015, Australian spot gas prices for power have surged, and manufacturers complain of scarce long-term contracts, even as traditional sources of southern gas supply have waned.\n<\/p>\n
Both the energy market operator and competition watchdog have warned of gas shortages since 2017, when the government adopted a mechanism to divert cargoes to the domestic market and avert potential shortage.\n<\/p>\n
Successive governments have imposed controls on exports and prices since.\n<\/p>\n
\u201cBoth buyers and sellers want a genuine market, not constant government intervention,\u201d Wood said.\n<\/p>\n
\u201cThe longer-term solution is simply more supply,\u201d said Tor McCaul, managing director of Comet Ridge, which produces gas in Queensland, selling some to Santos and developing more for the domestic market via specific permits.\n<\/p>\n
\u00a0<\/p>\n
Share This: <\/p>\n
More News Articles<\/p>\n","protected":false},"excerpt":{"rendered":"Australia is set to issue a gas market review that could curb exports of liquefied natural gas from…\n","protected":false},"author":2,"featured_media":183473,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[72,113,61,60],"class_list":["post-183472","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-ie","tag-ireland"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/183472","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=183472"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/183472\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/183473"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=183472"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=183472"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=183472"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}