Queensland Opens More Land for Australia-Only Supply After Pilot Success
The Queensland government has opened tenders for more acreage for gas exploration with Australia-only sale conditions following the success of its pilot project with Senex Energy earlier in the week, the state government said September 6.
The tenders cover almost 400 km2 of land in the state’s Surat and Bowen Basin and come just one day after the natural resources and mines minister, Anthony Lynham, announced Senex had won the pilot tender for 58 km2 of acreage in the Surat Basin.
The pilot tender was being used to test whether there would be market interest in acreage which, for the first time, came with provisions of resources legislation to direct gas to the domestic market.
The move comes amid concerns that the east coast of Australia could face gas supply issues in the next couple of years, and comes in contrast to a plan by the federal government to limit LNG exports if there is not sufficient supply of gas to meet the forecast needs of Australian consumers.
“The key to meeting east coast gas supply needs is more gas, not taking gas from one party to give to another,” Lynham said.
The federal government’s decision on whether it will limit exports next year is expected by the end of October. It targets the LNG exporters in Queensland, which are the only ones connected to the east coast market.
Industry body, the Queensland Resources Council, praised the move by the state government and criticised other east coast states, New South Wales and Victoria, for their restrictions and bans on onshore gas development.
“These domestic gas releases are fast tracked for production with Senex aiming to have gas flowing in under two years. That’s exactly when [the Australian Energy Market Operator] say New South Wales might be running short of gas,” QRC chief executive, Ian Macfarlane, said September 6.
“The New South Wales and Victoria governments must follow in the footsteps of the Queensland government and work with industry, otherwise gas will just move from one state to another while prices rise. We can’t ask businesses to dim the lights or buy diesel generators over summer – we have to supply them with more gas,” he said.
The tenders for 395 km2 in south-west Queensland are due to close December 8, and preferred tenderers are expected to be announced in the first quarter of next year, the state government said.
Nathan Richardson