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Western Australia re-examines gas reservation policy

  • Märkte: Natural gas
  • 28.06.23

Western Australia's (WA) parliament announced on 26 June that it will re-examine the state's 17-year-old domestic gas reservation scheme following concerns about the policy's ineffectiveness for its estimated 780,000 pipeline customers.

The Parliament of WA's Economics and Industry Standing Committee will hear evidence of how effectively the policy — implemented by the Carpenter Labor government in 2006 — is working for the state's industrial and household users. Submissions are open now and will close on 11 August with a report to be submittedto parliament by 30 November.

The policy is aimed at ensuring that 15pc of gas produced from the state's gas fields is retained for use in WA, with the remainder exported as LNG. But not all producers are required to meet the 15pc rule, as the state government applies the regulation flexibly on a project-by-project basis.

The inquiry comes after WA lobby for domestic gas users DomGas Alliance said it believes only about 10pc of state production is currently being supplied to WA customers, in response to the Australian Energy Market Operator's December 2022 report on forecast shortfalls in WA gas. DomGas Alliance on 15 December 2022 called on the WA government to ensure compliance with the domestic reservation regime and urged LNG producers to bring forward gas deliveries promised for local users to bridge a predicted 2024-2027 supply shortfall.

WA banned the export of onshore gas as LNG in 2020, but granted an exemption for Australian independent Beach Energy's Waitsia project, with former premier Mark McGowan citing "exceptional economic circumstances" caused by the Covid-19 pandemic.

"The WA domestic gas policy has been in use since 2006 and has generally served us well," committee chair Peter Tingley said on 26 June. "In light of the rapidly changing energy landscape however it is time to consider its role in meeting WA's gas needs as we transition to clean energy."

Australia has been mulling further interventions targeting its gas industry, as governments grapple with rising energy costs and shortfalls in gas supply for the east and west coast markets. WA is projected to experience a tight gas market until 2026.


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