KALGOORLIE (miningweekly.com) – The Australian government has outlined a range of actions to safeguard gas supplies in Australia, after a report from the Australian Consumer and Complaints Commission (ACCC) warned of a 56 PJ gas shortfall in 2023.
Resources and Northern Australia Minister Madeleine King announced that she is preparing to issue a notice of intent to make a determination to invoke the Australian Domestic Gas Security Mechanism (ADGSM).
Following consultations, the Minister also announced the government would extend the ADGSM until 2030, with a review due in 2025.
With the ADGSM currently due to expire in January 2023, and having not been extended beyond its current sunset clause, the trigger for the ADGSM could not be pulled until regulations ha bdeen updated, King said, adding that this work was now urgently under way.
“Once the mechanism is available, I will take the first step in activating it,” King said.
“The government will ensure Australian householders and businesses continue to have access to reliable energy supplies and we will take whatever steps are needed to avoid a repeat of the crisis we faced in early June.
“Based on the forecast shortfall, the government needs to see firm commitments out of the east coast liquefied natural gas (LNG) exporters. I will continue to work with gas and LNG producers, as well as state and territory governments to encourage new supply, and to find industry-led solutions to secure Australia’s ongoing energy needs.
“The government is also talking with key trading partners to reassure them that Australia remains a trusted trading partner and a stable and reliable exporter of resources and energy.”
The Australian Petroleum Production & Exploration Association (Appea) said this week that a review of the ADGSM should maintain investment confidence among international trading partners.
The industry body said it would work constructively with the Australian government during its ADGSM review, with acting CEO Damian Dwyer saying the industry was already acting to cover supply next year.
“As we have done throughout winter when coal and renewable generation failed, the gas industry is working to get the gas to where it needs to be and customers can be assured supply will be adequate next year so they can continue uninterrupted,” he said.
“The ADGSM was designed to ensure both export and new supply levers were available to cover demand.”
Dwyer noted the review was guided by seven principles including maintaining trust with international trading partners and investors.
“The principles are already areas of focus for the industry, from ensuring domestic supply, competitive prices, contributing to global energy security, decarbonising under our commitment to net zero by 2050, enhancing transparency and reducing cost burdens,” he said.
“It is also significant that the review aims to respect our world-leading position and global reputation as an exporter that has delivered extraordinary economic benefits to Australia.
“Australia needs to be very mindful of any signals sent by any policy changes to our longstanding trade and investment partners around the world who have invested in the Australian economy because of our stability.
“It is even more important to demonstrate consistency, certainty and market stability for the cleaner energy future given these same trading partners are those Australia will work with to build our future hydrogen export industry.”
The ADGSM is a measure of last resort which allows the government, in the event of a predicted shortfall, to restrict exports to ensure enough gas is available for domestic use.