Connect with us

Hi, what are you looking for?

World News

Australia’s LNG exports may have to be diverted to fend off winter gas shortage

 – Australia’s east coast liquefied natural gas (LNG) exporters may need to divert excess gas supply for domestic customers to stave off any potential supply shortages this winter in the country’s south, the energy market operator said on Thursday.

Despite increased production commitments from the industry since last year, the supply in southern Australia is declining rapidly, raising risks of near-term shortages and long-term supply gaps, the Australian Energy Market Operator (AEMO) said.

“To minimize shortfall risks, committed infrastructure and supply projects must be completed on time … additional gas storage and pipeline development and LNG import terminals could potentially play a role,” Chief Executive Daniel Westerman said in a statement accompanying AEMO’s closely watched outlook.

“The risk of gas shortfalls each year from winter 2023 to 2026 in all southern jurisdictions remains under extreme weather conditions … with those risks further exacerbated if gas storage levels are insufficient,” Mr. Westerman said.

From 2026, Australia must require additional commitments to expand its gas supply or have enough renewable projects to offset the demand for gas, AEMO said.

Gas producers said they are reluctant to invest in new supply after government interventions in the market, including proposals to impose a “reasonable pricing” regime on gas and expand the government’s ability to divert gas exports to the domestic market.

We need a clear strategy from governments to promote new supply to avoid shortfalls ... rather than ad hoc interventions that do the opposite and undermine investment confidence,” said Australian Petroleum Production & Exploration Association head Samantha McCulloch on Thursday.

AEMO said investment uncertainty over the development of Australia’s first LNG import terminal – Squadron Energy’s Port Kembla in New South Wales – could also impact supply shortfall.

Energy minister Chris Bowen on Thursday rejected the link between government intervention, including a 12-month price cap on gas, and investment uncertainty, saying almost all gas prior to 2022 was sold at prices below the cap.

Like many countries, Australia has been hit by soaring power and gas prices after Russia invaded Ukraine and also from planned and unplanned outages at several coal-fired plants.

Though Australia produces more gas than it needs to meet its domestic demands, most supply is contracted for export. – Reuters

Enter Your Information Below To Receive Free Trading Ideas, Latest News, And Articles.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

You May Also Like

World News

Toronto’s school board has become the first in Canada to recognize that caste discrimination exists in the city’s schools and has asked a provincial...


A PROPOSAL to reduce tariffs to zero for imports of natural gypsum will stimulate domestic production of gypsum board, a construction material used in...


Tomorrow is Ash Wednesday. For Catholics around the world, it is the beginning of Lent, a period for reflection and contemplation. Speaking of reflection,...


THE Bureau of Internal Revenue (BIR) is studying the establishment of an international tax division specializing in deterring transfer pricing abuses. “We are trying...

Dislaimer:, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2023 All Rights Reserved. Spirit