PERTH (miningweekly.com) – The Australian Competition and Consumer Commission (ACCC) has called on Australia’s southern state to allow gas exploration in a bid to secure supply.

“Southern states risk facing a shortfall in the medium term unless there is more exploration and development in the south, or new infrastructure to bring more supply to southern states,” ACCC chairperson Rod Sims said on Tuesday.

“We continue to urge state and territory governments to assess individual gas development applications on a case-by-case basis. We also suggest they actively manage tenements to prevent ‘warehousing’ of gas, and that they coordinate the development of pipeline and storage infrastructure to avoid unnecessary duplication.”

The ACCC’s Gas Inquiry 2017-25 interim report has found that the supply outlook for 2020 has improved slightly since July 2019, but beyond 2020 there is significant uncertainty about whether future demand can be met.

Projected supply for 2020 is now at 2 025 PJ while demand is forecast to be 1 831 PJ, not including liquefied natural gas (LNG) producers’ excess gas, the report read.

However, the long term supply outlook for the East Coast gas market from 2021 to 2031 remains uncertain.

The report stated that Southern States risks facing a shortfall in the medium-term unless more exploration and development occurs in the south to compensate for declining ex-Longford production, more investment occurs in north-south transportation infrastructure to enable greater volumes of gas from Queensland or the Northern Territory to flow south, and one or more LNG import terminals are developed.

To avoid any unnecessary duplication of pipelines and other inefficiencies, the ACCC has recommended that the development of this infrastructure, where feasible, be coordinated by state and territory governments during the planning and approval process, and operated on a third party access basis.

“We also support governments actively managing tenements to ensure producers bring gas to market in a timely manner and to prevent larger producers from ‘warehousing’ gas. A greater diversity of suppliers will be most effective in achieving this and, for its part, the ACCC will continue to closely monitor producers’ development decisions,” the watchdog said.