The eastern Australian gas market is experiencing a period of significant transition with the development of coal seam gas (CSG) resources and the associated creation of an east coast Liquefied Natural Gas (LNG) export industry.
In response to concerns about the dynamics of the eastern Australian gas market, the Department of Industry and the Bureau of Resources and Energy Economics (BREE) undertook the joint Eastern Australian Domestic Gas Market Study. Under the terms of reference released on 27 May 2013, the objective of the Study was to inform policy makers of the demand supply situation in the eastern Australian gas market and barriers to domestic gas supply over the period 2012-2023, as well as canvassing opportunities to improve market efficiency.
The Study was released on 3 January 2014, and is available below:
The eastern Australian market is undergoing substantial change as it moves towards first LNG exports from 2014, with gas production expected to triple to nearly 2,300 PJ/year by 2016.
Many long term domestic gas supply contracts will expire during the next few years and replacement contracts for supply need to be secured. While there are sufficient gas resources to meet both domestic and export needs, lack of transparency and uncertainty around whether supply can ramp up sufficiently quickly to meet demand and the cost of the new gas developments is affecting price discovery and disrupting contract activity. The Study examines drivers of these changes in the market as a context for policy.
The policy options canvassed in the Study focus on helping the market address the major sources of uncertainty through providing more information to the market and encouraging supply responses by addressing regulatory issues. In the longer term, there is an opportunity to inform the development of a new gas market reform agenda. The policy options are categorised under the six themes of:
- Further reform of gas markets
- Promoting gas supply competition
- Improving the commercial and regulatory environment for gas infrastructure
- Improving market data and transparency
- Role for non-market inventions
- Governance and implementation issues
As noted in the Study document, during the course of this work the Department commissioned advice from a number of consultants as input to its analysis. Reports by Intelligent Energy Systems (IES), Resources and Land Management Services (RLMS), and Sinclair Knight Merz (SKM) are available below.
Submissions to the study
Following the release of the Study, the Department invited stakeholders to make submissions on the issues presented in the Study, and any other matters they considered relevant. Submissions closed 7 February 2014. The following Guidelines to Submissions document was provided:
The following public submissions were received:
The Government released the Energy Green Paper on 23 September 2014. The Green Paper includes policy approaches to ensure reliable and affordable energy that, when used productively, supports business competitiveness, lowers the cost of living, and grows exports. The Government's response to these and the eastern Australian gas market and supply issues will be included as part of the Australian Government's Energy White Paper which will be released in due course.
For further information on the Australian Government's response to eastern Australian gas market and supply issues please contact email@example.com.