The latest report from the Australian Competition and Consumer Commission (ACCC) shows the east coast gas market is forecast to have sufficient supply to meet forecast demand for the remainder of 2023.
In August 2022 the ACCC forecast a shortfall of 56 petajoules (PJ) in the east coast gas market in 2023 led the government to take action in order to prevent supply crisis to eventuate.
“The east coast gas market is forecast to have sufficient supply to meet forecast demand in 2023, if the LNG producers commit at least an additional 3 PJ of gas to the domestic market in 2023 over already contracted levels,” the report stated.
“The east coast market is not expected to face a material shortfall under these circumstances.”
According to ACCC, the supply-demand outlook has improved by 27 PJ since the forecast in our January 2023 report due to “an increase in production estimates” and “a reduction in LNG producers uncontracted gas that may potentially be exported.”
The Heads of Agreement, secured in September 2022 with the three east coast LNG Exporters ensures an additional 157PJ of gas is made available to the domestic market before being contracted for export.
The ACCC has now expressed being sufficiently satisfied that there won’t be a material shortfall in the eastern market for the remainder of 2023, particularly if another 3 PJ is contracted to domestic users.
While the ACCC forecasts the domestic market will need an additional 11 PJ in the third quarter of 2023, they note there is a surplus of 18 PJs available to meet this demand and the Government is confident the commitments made under the Heads of Agreement are more than sufficient to cover this quantity of gas.
This ACCC data is one of the key inputs to the Minister for Resources and Minister for Northern Australia Madeleine King’s consideration to not commence the notification period for the newly reformed Australian Domestic Gas Security Mechanism for the upcoming quarter.
“The government understands that reliable energy supply and affordable energy prices are top of mind for Australian families and Australian businesses,” King said.
“This is why we also took action with the Energy Price Relief package to take the sting out of energy price rises.
“I continue to work with the resources sector to ensure it delivers the energy and minerals needed for our own security and clean energy transformation, as well as well as the energy security of our trading partners. “
The ACCC report is available here.
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