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    Appea says sufficient gas available for domestic supply

Summary

Australia has seen rapid demand for gas this winter because of the extreme pressure on the broader energy system.

by: Shardul Sharma

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Complimentary, Natural Gas & LNG News, Asia/Oceania, Liquefied Natural Gas (LNG), Corporate, Political, News By Country, Australia

Appea says sufficient gas available for domestic supply

Australia’s peak oil and gas body Appea on August 1 said that the gas industry will ensure gas supply next year, reassuring customers that the industry is responding to ensure energy security.

Appea said the Australian Competition & Consumer Commission (ACCC) Gas Inquiry Interim Report published on August 1 was designed to provide new information that would allow the industry to plan and respond to issues before they actually occurred. ACCC forecasts a 56 PJ shortfall to the east coast market for 2023. 

“The ACCC report shows 167 PJ of uncontracted gas is available for supply into the domestic market next year. This is more than enough gas to ensure that no shortfall occurs,” said Appea Acting CEO Damian Dwyer.

Dwyer said there had never been an actual shortfall and the ACCC had found 11 consecutive surpluses previously. “There has never been an actual shortfall and there will not be one next year – this is the ACCC signalling that action is needed, and the industry will act,” he said.

The ACCC report shows contract prices for gas delivered into the market in 2022 and for delivery into the market in 2023 remained competitive, Dwyer said. The report found, for example, that prices paid for gas supply agreements for delivery into southern states falling from $11.50/GJ in January-August 2021 to $9.25/GJ in September 2021-February 2022.

“While prices for delivery in 2023 have increased, they remain well below international prices,” he said.

Appea said the reason for pressure on the system witnessed recently is the extraordinary and rapid demand for gas seen this winter because of the extreme pressure on the broader energy system.

Dwyer said the report further underlined the need for more supply and investment to continue to ensure energy security.

“Today’s ACCC report underlines what we have been saying for a long time: ensuring more investment in supply with conducive policy settings,” he said. “We have been warning for years that moratoriums and bans in Victoria and New South Wales – our two biggest users of gas – are going to have an impact and that is making the pressures worse.”