Here it is:
So, this is a direct attack upon Santos and GLNG, given it is the only firm that is not a net contributor to the gas market.
However, there is no guarantee that this will drop prices for very long and it is not going to drop them very far, either. If GLNG and its customers opt for gas swaps then the price today will be $9.78Gj. That may be better than $15-20Gj but it’s still 200-300% higher than the past. Moreover, the moment the Australian dollar falls or the oil price jumps then gas prices will rocket. Check out the history of this pricing link versus local contracts:
Why the AIG campaigned for this measure I will never know. They’ve secured a short term gain but have squandered the momentum for long term reform. For the nation, we’ve just locked in an inflation shock the moment times get tough.
As well, the cheapest and best gas reserves remain locked up in the cartel and there is little incentive for the them to develop them when they can control the price by not doing so. We also need “use it or lose it” rules.
I’d couch this measure as the bare minimum. It really only winds back the gouge a year or so but it goes on.
