Page 15 - AsianOil Week 13 2021

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AEMO: LNG imports can delay

Australian gas supply shortages

PERFORMANCE THE Australian Energy Market Operator
(AEMO) has said an anticipated shortfall in
natural gas supplies can be delayed as long the
country begins importing liquefied natural gas
(LNG) by the end of 2023.
In its annual Gas Statement of Opportunities
(GSOO), which was published on March 29, the
operator said it predicted an improved outlook
for gas supply until at least 2026 across the east-
ern and south-eastern gas systems as long as cer-
tain parameters were achieved.
It noted that the outlook was more optimis-
tic as long as committed field developments and
pipeline expansions proceeded as planned and
the Port Kembla Gas Terminal (PKGT) entered
operation before the 2023 winter.
Squadron Energy is developing the LNG
import project at the titular New South Wales
port and aims to supply more than 75% of the
state’s annual gas needs once the facility is up and
running.
AEMO, however, warned that southern supply
was at risk if PKGT was delayed and certain condi-
tions emerged, such as a 1-in-20 maximum winter
daily demand in Victoria, coincident peaks across
southern regions, power-system events signifi- “This development comes at a critical time, as
cantly increasing gas-powered generation (GPG) existing Victorian production is declining faster
of electricity, or gas production outages. than previously projected,” Falcon said. “Our
AEMO’s manager of forecasting, Nicola Fal- annual analysis shows that without the [PKGT],
con, said the announcement of the PKGT had the decline in flexible gas from existing fields
improved supply capacity with an estimated would mean we need to rely heavily on storage,
injection of up to 500 TJ (13.02mn cubic metres) and increasingly on constrained pipeline infra-
per day. structure to meet the needs of gas consumers,
especially during high demand days in winter,”
she said.
AEMO’s GSOO also highlighted that the
gas sector was on the cusp of transformation,
with changes in consumption patterns forecast
and alternative supply sources being actively
developed.
“Australia’s energy sector is going through a
rapid transition, driven by changes in consumer
behaviour and efforts to decarbonise the system,”
Falcon said. “This report recognises the poten-
tial of electrification, fuel switching to hydrogen,
the Australian Government’s vision for a gas-
fired recovery and LNG imports to all influence
investment opportunities in the gas sector.”
She added: “Investments to address forecast
supply gaps in the second half of this decade
need to consider the transformation under-
way and be adaptable to manage changes
in gas consumption. There are a number of
initiatives at both Commonwealth and state
government levels that could change the mar-
ket and impact the outlook described in the
report, including proposals to drive more gas
into the system.”™

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