APA Group with the news. AFR.
The chief executive of the country’s biggest gas transporter, APA Group, has fired off against plans to import LNG to avert a potential gas shortage, warning that the high cost of imports risks turning consumers and industry against gas altogether.
Adam Watson said importing liquefied natural gas into the south-east – as proposed by companies including Andrew Forrest’s Squadron Energy and Viva Energy – would cost about double the price of gas from the Beetaloo Basin in the Northern Territory. It would also involve higher carbon emissions.
“It’s just ludicrous to think that LNG imports can be delivered into Australia at prices substantially lower than domestic gas,” Watson told investors on a conference call after APA posted a 6.4 per cent gain in core earnings for the full year and forecast stronger growth in the coming year.
APA has a vested interest. LNG imports will price out gas usage, and their volumes will fall.
However, on this occasion, that does not make it wrong.
Beetaloo gas will be half the price of LNG imports on current prices.
The problem is, this is still way too expensive. We need prices to fall, not just stabilise.
That is why I see the current push by the gas cartel, effectively agreeing to export limits in return for more supply, is another scam.
There is nothing normal about current gas prices in Australia, and a much better solution is to use Peter Dutton’s export levies to force production and local sales of spot gas into Australia.
It’s easily the best proposal I have seen in this debate. The only feature I would add is to give it a price target of $7Gj, not $10Gj.
