Via the AFR:
The Turnbull government is set to pull the trigger on limiting gas exports within days following the latest report from the Australian Energy Market Operator warning there is a significant risk of a gas shortfall in the eastern states over the next two years – and it could get worse.
With Prime Minster Malcolm Turnbull and Deputy Prime Minister Barnaby Joyce briefing industry leaders in Sydney on Monday, the move to secure more gas for the domestic market could be enacted as soon as Tuesday and will hit all the big gas producers including Origin Energy, Santos and Shell.
The AEMO report said the projected shortfall risk for 2018 is between 54 petajoules to 107 petajoules, and between 49 petajoules and 102 petajoules in 2019, with a credible risk it could be at the higher end of the scale in both years.
“The shortfall could be higher than expected, in a variety of plausible circumstances that would increase demand for gas by household and business consumers, and for gas-powered generation of electricity in the National Electricity Market,” the report said.
100Pj is roughly half of one LNG train. If we don’t want this problem to become permanent we need the following solutions:
- larger domestic reservation;
- harsh lose it or lose it laws for reserves;
- a domestically-focused national gas company to force acquire or expropriate reserves as required and develop them in ways that assuage community anxiety about fracking, as well as benchmark prices in the market via mandated margins;
- price controls where necessary and tougher pipeline regulation.
We’re just getting started.
