Affordable fuel, no shortages: Bowen's domestic reservation threat for gas industry

The Age

6 hours ago

East coast gas producers may be hit with a first-ever reservation scheme to boost crucial supplies of the fuel, the Albanese government has declared, as the consumer watchdog warns the nation's eastern states may suffer a shortfall by the end of the year.
Energy Minister Chris Bowen on Monday announced a wide-ranging review of the gas market to report by the end of the year, which he said would 'ensure Australian gas is available to Australian users at reasonable prices'.
'That's a reasonable request by the Australian people and one that we will continue to work to deliver,' Bowen said.
Former opposition leader Peter Dutton shocked the gas industry when he released a plan to impose a reservation on LNG exporters before the May election. His policy was to charge companies for uncontracted gas supplies shipped overseas instead of being kept in Australia.
Bowen ridiculed Dutton's plan at the time as a 'dot point in a press release', while on Monday he described his review as a 'very substantial, methodical process'.
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The Australian Competition and Consumer Commission released its six-monthly gas report on Monday, which once again found that ongoing structural supply shortfalls would hit in 2028.
It also warned that the supply balance had 'deteriorated' since the end of last year and shortages could bite by December and throughout 2026 unless the east coast gas exporters in Queensland agreed to sell into NSW and Victoria, rather than exporting it to Asia in the form of liquified natural gas (LNG). Prices had fallen slightly, but remain elevated since the 2022 global energy shock caused by Russia's invasion of Ukraine.
Homes and businesses on the east coast are running short of gas for three reasons: The massive onshore fields in Queensland export a significant amount of their production to Asia; the pipeline that connects these fields to NSW and Victoria is already running at full capacity and; the 50-year-old gas fields in Bass Strait are fast running out of reserves, with barely any new supply projects to replace them.