PERTH (miningweekly.com) – Federal Industry, Energy and Emissions Reduction Minister Angus Taylor has called for more investment in the gas sector, warning that consumers could face higher prices and disruptions in supply.

Speaking at the Australian Domestic Gas Outlook conference, in Sydney, Taylor pointed out that the Australian Consumer and Competition Commission was forecasting southern supply gas shortfalls from 2024 to 2030, and an east-coast-wide shortfall from 2027. 

“A coalition government will work to make sure we do not face the economic devastation that a gas supply shortage would inevitably cause. Our landmark National Gas Infrastructure Plan shows we need at least one new basin online before 2030 to avoid future shortfalls. 

“These basins include the Narrabri project in New South Wales, the world-class Beetaloo sub-basin in the Northern Territory and the Galilee and North Bowen basins in Queensland.

“The expansion of existing gas storage and pipeline capacity and the construction of new pipelines are needed to encourage more flows of gas to southern states,” said Taylor.

“That’s why we committed more than A$38-million in last year’s Budget to back critical projects, including the recently announced A$32-million loan to the Golden Beach production and storage project in offshore Gippsland, Victoria. 

“This project is expected to produce local gas for the domestic market for around two years before converting to an underground gas storage facility. The 12.5 PJ of storage will help meet demand for gas during times of peak demand and keep a cap on prices.”

Taylor pointed to the International Energy Agency, which has reiterated the importance of gas storage to provide insurance against unexpected events. 

“As noted in their latest Gas Market Report, a tight market with low storage levels can drive up gas prices,” Taylor said.

Pointing to Australia’s own gas use, Taylor noted that gas made up 42% of total energy use in the manufacturing sector, and that gas consumption has been increasing significantly in the mining sector and now constitutes close to 49% of the sector’s final energy consumption nationally. In absolute terms, the sector’s total natural gas consumption is up 71% in five years.  

“As more renewable generation enters the grid at world-leading rates, the importance of reliable, dispatchable gas-powered generation continues to grow.

“Our nation has plentiful reserves of natural gas, but local production must increase or consumers will face higher prices and disruptions in supply,” Taylor said.