The latest report from the highly regarded energy commentator, EnergyQuest, has highlighted the success of Coalition policy in making more gas available for the east coast domestic market and placing downward pressure on gas prices.
In its December 2019 report, EnergyQuest found that east coast gas production reached a record 500.1 petajoules for Q3 2019. This included record production of Queensland coal seam gas which was up by 6.8 per cent or 23.7 petajoules quarter on quarter, to a record 377.2 petajoules for Q3 2019. Q3 also saw the largest surplus supply of gas since LNG exports began in January 2015.
Queensland CSG has continued to supply southern markets, with increased flows going to New South Wales and Victoria.
“The Andrews Government seems intent on shutting down industries, from vegetable processors to aluminium smelters operating in regional areas of Victoria while they pander to green activists and Greens in inner city Melbourne,” Minister Canavan said.
Minister Canavan said EnergyQuest also noted average short-term gas prices were down 7.8 per cent at $8.23 a gigajoule from $8.93 a gigajoule at the same time in 2018.
“Analysis of data released by the Australian Energy Market Operator is showing that short term prices are continuing to fall. Prices at the Wallumbilla Gas Supply Hub in Queensland were at $7.17 a gigajoule for November 2019, down from $9.95 a gigajoule in November 2018 and are down a whopping $5.32 a gigajoule from the average price of $12.49 a gigajoule we saw in February 2017,” he said.
This was before the Liberal National Government took decisive action to put in place the Australian Domestic Gas Security Mechanism in July 2017 and reached an agreement with the three LNG export projects at Gladstone to ensure gas supplies for the domestic market.
Both the AEMO and the ACCC have found that the ADGSM and the Prime Minister’s agreement has been effective in placing downward pressure on gas price offers and assuring gas supply.
Minister Canavan said the Government was working to keep downward pressure on gas prices.
“We recognise that many businesses are still doing it tough with energy prices and I am focused on keeping gas prices down so we have a vibrant manufacturing and processing sector in rural and regional areas,” he said.
“Western Australia has shown that a successful LNG export industry can survive and thrive with a gas reservation policy. I will ensure that gas is available and affordable for industry on the east coast as well, and will work with states and the Northern Territory and industry to implement a National Gas Reservation Scheme.”