Page 11 - AsianOil Week 11 2021

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Concrete details of the government’s plans to At issue with the gas-driven model was the
support Beetaloo will be welcome news for the idea that cheap supplies of the fuel, coupled with
basin’s developers, but they do come at a time undeveloped carbon capture and storage (CCS),
of growing speculation that Canberra’s “gas-led could be used to decarbonise the economy more
recovery” might be something of a folly. competitively than solar with battery storage.
It is a scenario not even Origin Energy, a major
Policy problems gas developer and exporter, was reportedly
RenewEconomy reported earlier this month convinced over.
that the Australian Energy Market Operator
(AEMO) was considering abandoning plans to What next
include a “gas-led recovery” scenario as part of The government’s plans for a gas-led economic
its 2022 Integrated System Plan. recovery have found few supporters outside of
The news outlet noted that key energy market the political world. On paper, it should be a win-
stakeholders had questioned the plausibility of ner: cheap supplies of a cleaner-burning hydro-
the government’s gas market vision. carbon will not only buoy economic growth but
Canberra unveiled its gas focused ambi- will also help the economy transition toward a
tions in September last year, when Prime Min- clean energy future.
ister Scott Morrison talked about resetting the But gas producers are unhappy at the sug-
energy market by increasing gas supply, deep- gestion of government-controlled pricing
ening energy security and promoting economic while green energy lobbyists have shown little
growth through lower prices. enthusiasm for gas as a transition fuel. Environ-
The government’s plans were built upon rec- mental campaigners argue that no matter how
ommendations in the first half of 2020 from the clean gas-burning becomes, fugitive methane
National Covid-19 Coordination Commission emissions caused by the extraction process will
(NCCC), which was later rebranded to National always render it incompatible with overarching
COVID-19 Commission Advisory Board climate change goals.
(NCC). The advisory group has championed the Nevertheless, the current government will
idea of cheap gas, with figures of AUD4 ($3.11) forge on with its gas-led plans, driven not just
per GJ gas subsequently bandied about in the by economic concerns but also by the East Coast
local media, as a means of revitalising the local market’s anticipated supply shortfall.
manufacturing sector. AEMO has been warning for some years of an
While the government has not specified a tar- impending gas supply shortfall on the East Coast
get price, it has said it wants to see more domestic market via its annual Gas Statement of Opportu-
upstream development that targets local buyers nities (GSOO) report. With the latest edition due
and supports lower prices. To this end, it has out at the end of this month, there is little reason to
started rolling out support for developers in five expect a shift in sentiment now, especially consid-
basin, with the Beetaloo at the top of the list. ering the slashing of upstream budgets over the past
RenewEconomy, however, noted that AEMO year owing to the COVID-19 pandemic.
would drop plans for “gas-led recovery” model Indeed, the Australian Competition and
in favor of a “zero net emissions” scenario in the Consumer Commission (ACCC) warned in
next edition of its 20-year development plan. The February 16 that the East Coast gas market
move came after only 38% of participants at an could witness an annual supply shortfall of as
AEMO-run workshop noting that the former much as 30 PJ (781.46mn cubic metres) as early
scenario was “not useful”. as 2023.™

Week 11 18•March•2021 www. NEWSBASE .com P11