The competition watchdog has calmed fears of a looming gas supply shortage, saying there will be enough gas to meet Australian domestic demand into next year as it forecasts a 9 per cent lift in liquid natural gas exports.
The Australian Competition and Consumer Commission’s (ACCC) quarterly report into the gas market, released on Wednesday, projects that even if all uncontracted gas produced in Australia is exported, there will still be an overall east coast surplus.
Bass Strait gas production has fallen steeply.
A surplus is good news for households grappling with a cost of living crisis amid fears of prices rising even further. In June, the watchdog flagged a winter shortfall of gas for heating and electricity generation.
The latest ACCC Gas Inquiry Report projects there will be an overall east coast surplus of 1.4 petajoules in the first three months of 2024. Gas supply during the same period will be 5.9 petajoules higher than forecast in June and 13 per cent higher than actual supply in the first three months of this year.
Export demand is expected to be 8.2 petajoules higher than the June forecast and 9 per cent higher than actual LNG exports in the first three months of this year, adding about $2 billion to gas producers’ revenue.
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If the LNG producers only export their long-term contract commitments and factoring in current anticipated sales, then there will be 19.9 petajoules of gas available to the east coast market, the interim report said.
Tennant Reed, director of climate change and energy at the Australian Industry Group, said despite the forecast surplus, the gas market was still “very tight”. There was also potential for things to go wrong like last year when a number of coal-fired power stations went offline at once.
“We shouldn’t breathe a sigh of relief and settle back in to the hammock just yet. However, it’s still a better picture than one year ago,” Reed said.