Turnbull, east coast gas providers agree plan to ensure cheaper, reliable energy

PERTH (miningweekly.com) – Prime Minister Malcolm Turnbull has met with east coast gas providers to formulate a plan to help deliver cheaper and more reliable energy.

A series of measures have been developed and all participants have agreed to ongoing work to deliver on the targets that have been set out.

The seven-tiered plan included a gas supply guarantee, new gas production, market transparency, state regulation, community support, gas market reform and the implementation of arrangements.

The gas providers will guarantee that gas will be available to meet peak demand periods in the national electricity market, and have agreed to make more gas available to the domestic market as soon as possible, to keep downward pressure on prices.

The producers have also agreed to revise their domestic gas production forecasts, while two liquefied natural gas (LNG) exporters have committed to being net domestic gas contributors, as part of their social licence.

For its part, the federal government has agreed to improve transparency in the gas market, to facilitate competition between producers and information for buyers, and a meeting will be called with the state and territory governments to revisit restrictions on gas exploration and development.

Gas market reforms arising from the recent Australian Competition and Consumer Commission gas review will be accelerated, with the reforms aimed at improving pipeline capacity trading and gas trading markets.

Further, the government is establishing a task force to manage implementation of the above outcomes and report to the Cabinet Energy Committee.

“It is vital that Australians have access to reliable, secure and affordable gas, whether it’s for the generation of energy, electricity, or whether it’s for industry, families and households,” the Prime Minister said after the meeting.

“The fundamental outcome of the meeting is this: that the producers have given us a guarantee to ensure that gas is available for the national electricity market. So there won't be a repeat of a situation where a gas-peaking power plant is called on by the regulator to produce electricity during a heatwave, and there's no gas available. That won't happen again, consistent with the guarantees we've been given.”

“We are a massive gas exporter. It is utterly untenable, unacceptable, for us to be in a position where domestic gas consumers – whether it's generators, whether it's businesses and industry, or whether it's families – cannot have access to affordable gas.”

The Australian Petroleum Production and Exploration Association (Appea) said its members were committed to working with the federal government to ensure sufficient gas is available to meet peak demand in the national electricity market.

Appea CEO Dr Malcolm Roberts said the meeting between the Prime Minister and gas producers in Canberra had been constructive.

“The Australian Energy Market Operator has highlighted that gas-fired generation must stay in the energy mix to protect energy security. Appea welcomes the Prime Minister’s initiative to work with the industry to remove the barriers to more gas supply,” Roberts said.

“The gas industry will always work to ensure there is sufficient gas to meet Australia’s domestic needs. This is despite the fact that some state and territory governments have made this task more difficult than it should be with unnecessary restrictions, moratoriums and blanket bans on new onshore gas projects.

“Australia will only secure its long-term energy future when unnecessary restrictions on natural gas development are removed.”