This is how bad the Albanese government is. Sensing that its rorting of the public will ultimately destroy its own licence to operate, the gas cartel is itself now demanding that it be constrained. SMH.
In a submission to the government’s review of the nation’s gas market, Australia Pacific LNG (APLNG) says an export licensing and permitting regime that guarantees supply for the domestic market is the best way to tackle concerns around looming supply shortfalls and higher prices.
“All east coast LNG producers have a role to play to support the domestic market; however, east coast LNG producers alone cannot be the solution for the entire projected shortfall in southern gas supply,” according to the APLNG submission, seen by this masthead.
“Without fundamental reform that delivers equitable domestic supply obligations across all east coast LNG producers, the existing instruments will continue to make projected future shortfalls worse by discouraging investment. A reformed policy framework must address LNG producer purchases from the domestic market for export.
They should have to equitably contribute gas for Australian jobs and power generation.”
I could not have put that better myself. But there is a sting in the tail. APLNG is selling out GLNG because it is it that buys the third-party gas that has contributed mightily to rising prices.
As it happens, that is Santos, which is currently under a takeover offer from ADNOC. Conveniently enough, GLNG has no Chinese or Japanese partners, either, so Albo’s sinogrovellers may not be quite so upset about it.
It’s no wonder the corrupt Grattan Institute supports the idea, given it is sponsored is Origin.
Grattan Institute energy policy expert Tony Wood has been critical of previous reservation policies but told this masthead the APLNG submission that is linked to east coast demand was broadly in line with the institute’s contribution to the government’s review.
However, the question remains, is this either fair or enough? Although it was STO that blundered most obviously in building a second train for GLNG, all of the QLD LNG exporters overbuilt amid the LNG price bubble post-Fukushima.
All of them have had to write off the value of the assets since.
Also, it has to be asked, can GLNG provide enough local gas constrained alone?
Within a decade, Australian shortages are expected to reach around 600PJ.
GLNG only exported 340Pj in 2024. Add 15% for lost gas, and we get to 390Pj of raw gas.
In short, tapping GLNG will wipe it out, and it still won’t be enough.
Which brings us to what this is really about. AFR.
Australia’s east coast LNG producers have thrown their support behind proposals to set aside export gas for domestic use, dramatically increasing the chances that Labor will impose a new, prospective gas reserve policy on Queensland’s export industry.
The peak body for the local oil and gas industry, Australian Energy Producers, told the government it would support domestic gas requirements for export projects, as long as they were tied to new gas developments.
The industry group, which represents “upstream” oil and gas giants including Woodside, Santos, ConocoPhillips, ExxonMobil and Shell, has been under pressure to help find a solution to the sustained rise in east coast gas prices since the start of the Ukraine war in 2022.
What are these new gas developments? If we are being tricky about it, all QLD gas is a new development because it is unconventional gas and new wells must be drilled all of the time.
But this will not be that. This is about developing other acreage, such as in the NT, to ensure that existing export volumes are not touched.
This comes with the bonus that it is expensive! Rystad.
That is exactly the gas price range that VIC is paying today.
It’s better than LNG imports, but it locks in rent-seeking profits for the cartel and some of the highest gas prices in the world.
This proposal is far worse than Peter Dutton’s gas reservation scheme, which would have dropped the price $10Gj.
You’re about to be sold out by Labor’s gas cooks again.
