Powerless Nev shrinks from low gas price targets

It’s all for bloody show, at The Australian:

National COVID-19 Coordination Commission chairman Nev Power has pushed back on energy industry criticism of his $4 target for domestic gas prices, admitting the low price is a “stretch target” but saying it’s an achievable goal in the long term.

“We’ve put out there some target of around $6 in the short term and $4 in the long term as a direct comparison with the Henry Hub price in the US. Now I’m the first to admit there are a lot of differences between our gas supply here in Australia and the Henry Hub,” he said.

“But as many of you would know from my history it’s about setting those big stretch targets and then looking at all of the factors – in productivity, in supply right through the supply chain – to work out how we can get there.

“If we can provide competitively-priced gas into the manufacturing sector we can develop fertiliser manufacturing and petrochemical manufacturing – these are products we already have scale in.”

Powerless Nev talks a big game but he walks a small one. The entire premise of the NCCC “gas-led recovery” is wrong. There is no more cheap supply to bring online.

The only solution is reserving current cheap production within the gas export cartel. It’s a simple problem – a cartel – with a simple solution – breaking it.

But that would require actual not fake leadership.

David Llewellyn-Smith
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  1. “But that would require actual not fake leadership.”

    This is the greatest issue of our time.

  2. Peter SMEMBER

    There is exploration potential for several Tcf of conventional gas in the offshore Otway Basin where wells cost ~$40 million each to drill and complete. If gas flow rates of over 30 mmcuft per day can be achieved in locations close to existing transport and processing infrastructure development, total costs for gas could be quite low.
    Production of say 20 Bcf per well could comne with a capital cost component of ~A$3/GJ all up after CAPEX on additional pipework and processing costs of leass than A$0.50 might be achieved, so that gas could be delivered at a cost of $4/Gj or a price of A$6/GJ, allowing for profit margins.
    Cooper Energy saw gas flow rates on test of over 60 mmcuft per day, so if that could be prelicated, total costs of supply could be much lower.

  3. This guy has overseen the importation of hundreds of thousands of tonnes of C h i n e s e machinery and equipment. Which was used to export iron ore which he and his cartel mates bought back as value-added goods.

    If he wants to help Australia he could get the Govt to tax away the lost value of imports made from local iron ore and coal. That way he’s saving the planet and revitalising our manufacturing sector.

  4. bolstroodMEMBER

    As a Queensland farmer said to me about his dealings with the gas industry,
    “They look you in the eye and they lie, and they lie , and they lie.”

    • Ahhh QLD farmers, like all farmers, still vote LNP like turkeys voting for Christmas.

      The Nats sold out on the farming sector decades ago. Farmers, as remedial learners, havent nutted this out yet.