Aussies plundered as ScoMo sends cheap gas to China

Via The Australian comes another useless sop to the gas export cartel:

Scott Morrison has struck a two-year deal with large east-coast LNG exporters to offer uncontracted gas first to Australian companies, in a bid to keep prices down and lower costs for manufacturers as part of the government’s COVID-19 recovery plan.

But the deal, signed on Wednesday night in Gladstone by the Prime Minister and Queensland’s three LNG producers, avoided formal price controls, which some big manufacturers had pushed for but were strenuously resisted by the LNG industry.

“Gas is critical to our economic recovery and this agreement ensures Australian businesses and families have the gas supply they need at the cheapest possible price,” Mr Morrison said. “This is about making Australia’s gas work for all Australians, while also supporting economic growth and backing important ­regional jobs in our expanding LNG sector.

…The Australian understands there is neither a specified price nor an international benchmark referenced in the heads of agreement, easing fears among big gas suppliers the rules would be ­rewritten after they have sunk more than $70bn into building Queensland’s giant gas export industry. They have argued that, should the pricing option be introduced, it could effectively represent a ­rewrite of regulatory rules, hindering future investment and Australia’s international reputation.

…Big energy users complain they can’t find gas on a contracted basis for less than $8 to $10 a ­gigajoule, more than double historic levels, which could force some facilities into importing products rather than producing Australian-made goods or even shutting their doors.

So, domestic reservation bites the dust again. Indeed, things appear to have gotten worse with no commitment even to export net-back prices, despite the protests of the ACCC.

And where does most of this cheap “contracted gas” go, which can be supplied locally at a cash profit for $4-6Gj? To China, which uses it to fuel much cheaper manufactures as it hollows ours out while conducting a trade war on everything else.

Herein lies the terrible political bind of Australians today. The Coalition’s China skepticism is serving us well geopolitically. But it’s economic corruption ensures no policy to mitigate the economic blowback.

Yet if Australians vote Labor, they get full-throated Chinese occupation.

We’re caught between the devil and the deep blue sea.

David Llewellyn-Smith
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Comments

  1. The gas cartel, as you put it, are 90% owned by the foreign investors and a sizable proportion of that by the Chinese interests. So they are doing what they are expected to do.

    Meanwhile, we are too busy bidding up house prices to worry about that kind of stuff. I guess we can always burn wood instead of gas. They say eucalyptus burns well, especially in bushes!!

    • Take some big multi-national miners or oil & gas players; BHP, RIO, WPL, STO… and check who own their shares.

    • Exactly we are led, and no sane third party pushing its head up nor a wolf in sheep’s clothing taking over any of the scum parties offering. They have it stitched up. Prefeeial voting, damn hard to avoid voting for a creep, forced voting, yes do it. None of the bastards whose name show except for the brave red head gal, give a stuff about Aus or Australians. Nothing since the Whitlam Coup.

    • Shades of MessinaMEMBER

      When a commercial organisation wants to change the terms of an agreement it is deemed as “a contractual re-negotiation”.

      When the Australian government has the potential to do the same it is deemed as “sovereign risk”.

      Such a shame we have the spineless, feckless pollies (on both sides) that we do. Not many other countries in earth would settle for such anti-patriotic policies.

      Any chance Norway could invade and install their pollies and resource policies ?.

      • If Straya were wise and had a long-term view, she would have implemented policies that take full advantage of nuclear power. The geography, the resource potential, the storage capacities, all point to a set of hugely successful and profitable export industries.

        Ah no, that would be too un-Strayan – we can’t have that. We must embrace the Moron Side of the Force!!

      • Back in the 1980s, the American kids were taught about two forms of socialism – the good socialism (Sweden) and the bad socialism (the USSR).

        Perhaps time to start teaching Strayan kids of two forms of corruption – the good corruption and the bad corruption!!

  2. I’m about two weeks away from disconnecting from gas at our place. No more gas and electricity bills for this black duck! Just need to think outside the box. The cash back from the elec retailer covers half the council rates too.

      • All-electric house here, including our car. I’m going to take a stab in the dark and guess: heat pumps for water and space heating and clothes drying and an induction stove and electric oven for cooking.

      • I have 3 Phase power here so could have 5Kw of solar per phase. Put a 15Kw system on the shed. With Solar PV, you have to generate about 3 times what you use to not get bills. eg, cost of elec is 27c and feed in tariff of 10c. I’m currently getting 14c feed in tariff which gives me about $1200 credit each year(on top of the $1500 savings in bills) This tariff I cant control and could drop to zero at any time in the future. Once/if this gets below about 6c, I will stop exporting and use it to heat the large hot water store i’ve built and maybe a battery once it becomes cost effective. The solar PV works out to be about 12% return.

        The hot water store is a 1500 Ltr stainless steel tank that has 3 heating inputs, 6x Solar thermal panels, 2x 9Kw emersion heaters that can run off excess Solar PV and a boiler jacket that’s in the wood heater. The tank has 2 heating outputs, a domestic hot water coil and a Hydronic circuit for heating the other end of the house from where the wood heater is.
        The tank stores about 60Kwh of usable energy.

        I built it all as a DIY project during lockdown when I couldn’t go anywhere. It only cost me about 8k to build as I built everything from scratch including the flat panel collectors. so about a 12% return.

        • Yep I have a similar system but mine uses an insulated and sealed 20ft shipping container to store about 30Kliters of water. The water can be heated or cooled with a reverse cycle heat pump and is plumbed to the main slab as well as several thick high thermal mass walls inside the house.
          I love it 25C year around and no electricity or gas bills.

  3. TheLambKingMEMBER

    “CHYNA !!!“

    Helps MB capture the right wing crazies that it seems to be going after at the moment. That andcrazy anti ABC stance are rwnj click bait

  4. Display NameMEMBER

    There are no political choices in Australia except independents. Toxic LNP or useless SJW Labour. Both sell your a$$ for a buck to anyone. And the greens just want to tear the place down. No help there. And the Greens really don’t care abut the environment, they are too concerned about their well paying political sinecures and the v.g. super they are getting.