Page 13 - AsianOil Week 20 2021

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Queensland boasts of

gas supply “rescue”

The state government has claimed that local gas projects
will soon rescue southern states from gas supply shortfalls

COMMENTARY THE Queensland State government last week company said volumes would be shaped to high-
trumpeted the news that it had “rescued” the er-demand winter months.
country’s southern states from a natural gas sup- Origin has also secured additional pipeline
WHAT: ply shortfall. capacity through a three-year agreement with
Origin and APLNG have Queensland Resources Minister Scott Stew- infrastructure operator APA that will allow it to
agreed to send more gas art said on May 11 that an agreement between pump significant volumes of gas south from 2023.
south. Origin Energy and Australia Pacific LNG “Once again Queensland is stepping up and
(APLNG) would see more of the state’s gas flow doing the heavy lifting on domestic gas supply
WHY: south ahead of a predicted shortfall. and policy,” Stewart said. “This deal will bring
AEMO has predicted gas Stewart said an additional 91 PJ (2.37bn additional gas to the domestic market, par-
shortages in the southern cubic metres) per year of gas would be available ticularly to the southern states who are facing a
states. to southern states from 2022 following the two potential gas shortage crisis in the coming years.”
sides’ four-year supply agreement. He added that Stewart highlighted his government’s ongo-
WHAT NEXT: the additional gas would help to meet a potential ing efforts to encourage gas production for the
Gas supplies to shortfall forecast by the Australian Energy Mar- domestic market through the release of acreage
Queensland’s projects ket Operator (AEMO) to emerge from 2023. where output is ringfenced for local buyers.
may dry up later this Stewart, however, ignored the fact that The official added that the additional gas
decade. AEMO now considers such a gap as unlikely to from APLNG would help to meet a “potential
arise until at least 2026, given growing support gas shortfall from 2023 as forecasted by” AEMO.
for liquefied natural gas (LNG) imports. His comments, however, somewhat over-
Perhaps a more troubling prospect for the state the looming supply shortfall, with AEMO
state is the fact that feedstock supplies for its itself noting in March that the start-up of just
three world-class LNG export plants could begin one LNG import project would help to delay gas
drying up as soon as 2030. shortages until at least 2026.

Bragging rights Justified concerns?
Stewart’s comments were posted nearly a full The prospects of a short-term gas supply short-
week after Origin announced that it had secured age have been a recurring theme of both AEMO
additional gas to increase supply to customers in and the Australian Competition and Consumer
southern markets “materially”. Commission’s (ACCC) annual reviews of the
Origin said on May 5 that it had signed a East Coast gas market.
supply agreement with APLNG – in which both AEMO has consistently warned that the
it and ConocoPhillips hold 37.5% and Sino- southern states were on the verge of seeing sup-
pec owns 25% – for an additional 91 PJ of gas plies fall short of demand, with Victoria forecast
from January 2022 at a JKM-linked price. The to experience shortages first.

Week 20 20•May•2021 www. NEWSBASE .com P13