PERTH (miningweekly.com) – A new report by the Australian Energy Market Operator (AEMO) has highlighted that Western Australia’s potential gas supply could exceed forecast domestic demand over the next ten years.

In the 2019 Western Australia Gas Statement of Opportunities, the AEMO noted that in the base-case scenario, supply capacity in Western Australia is expected to expand by 125.6 TJ/d by 2021, with the start of the Xyris expansion in 2020, and the second tranche of the Gorgon project in 2021.

Gas demand is forecast to grow at an average annual rate of 1.2% in the base scenario, largely due to growth in the mining and minerals processing sectors, which includes six committed projects that will add some 60 TJ/d to domestic demand by 2023, the AEMO said.

In the high scenario, prospective demand projects could consume an additional 168 TJ/d by 2025, increasing demand for Western Australian gas by around 17%, to 1 332 TJ/d. However, the AEMO noted that potential gas supply in the high scenario is forecast to be sufficient to meet this additional demand for the majority of the outlook period.

The Australian Petroleum Production and Exploration Association’s (Appea’s) Western Australian director Claire Wilkinson said the report highlighted the development of prospective gas supply sources will maintain supply adequacy over the outlook period.

“Western Australia continues to benefit from bipartisan political support for resource development and an active industry committed to meeting the needs of its domestic and export customers,” Wilkinson said.

The report finds prospective supply sources are expected to be available and economically viable to enter the market in 2022, 2024, and 2026, partly offsetting the decline in potential gas supply from existing production facilities due to reserve depletion.

Wilkinson said Western Australia’s resources of unconventional gas (shale and tight gas), mostly located in the Canning and Perth basins, are estimated to be substantial.

“While Western Australia benefits from substantial remaining conventional gas resource, over the next decade development of additional onshore unconventional resources will be needed to ensure the state continues to benefit from sustained adequate and affordable gas supply,” she said.