Natural gas

Australia's east coast to have surplus gas in 4Q: ACCC

Australia's east coast to have surplus gas in 4Q: ACCC

Sydney, 10 July (Argus) — Gas supply volumes entering Australia's east coast grid will be more than sufficient to meet demand in October-December, the Australian Consumer and Competition Commission's (ACCC) Gas Inquiry June 2026 interim report said. The east coast gas market is predicted to have a 13PJ (347mn m³) surplus even if LNG producers export all their uncontracted gas, the ACCC reported on 10 July. The October-March period is generally a time of lower gas demand due to warmer temperatures and higher wind and solar power generation. The forecast is the highest surplus predicted for the final quarter of the year since 2023. A possible 12PJ shortfall in July-September forecast in the ACCC's March report is unlikely to emerge because Shell-operated QGC's rescheduling of maintenance from April to July may result in exports over this period dipping by up to 8PJ and similar volumes made available to the domestic market, the ACCC said. The Iona storage facility is at record levels for this time of year, the report noted. The 26PJ facility in Victoria state is at 82pc of capacity on 10 July, up from 64pc a year earlier. The ongoing conflict in the Mideast Gulf region has had no material impact on domestic spot prices and demand and prices remain suppressed, the ACCC said. The federal government plans to oversupply the eastern states' domestic grid from July 2027 via a domestic supply obligation (DSO) equal to 20pc of LNG exports imposed on Australia's 10 LNG projects. The aim is to further push down gas prices, but the DSO is opposed by most gas producers and Queensland's state government . Supply boost needed Long-term supply projections confirm more investment is needed to meet demand, the ACCC said on the proposed DSO. Policies must incentivise investment and promote greater diversity and competition in supply, the report said. Gladstone-based LNG producers control about 84pc of proved and probable (2P) eastern states reserves directly or via purchases from associated entities. These producers must further develop their reserves and resources to meet obligations, particularly under a DSO, the ACCC said. "Reducing barriers for new entrants and producers seeking to develop prospective resources would help increase and diversify supply, increase competition and put downward pressure on prices over the longer term," ACCC commissioner Anna Brakey said. Domestic gas demand has been sluggish so far this Australian winter, due to higher temperatures and increased battery storage, reducing demand for both heating gas and gas-fired power generation. By Tom Major Eastern LNG producers' longer-term position, 2028-38 PJ 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2P production 1,301 1,241 1,134 1,067 1,019 952 895 841 781 716 664 Third party purchases 196 241 244 251 263 280 282 276 260 251 239 Total supply 1,497 1,482 1,377 1,318 1,282 1,231 1,177 1,116 1,041 967 902 Sales to the domestic market 83 83 84 73 60 56 36 16 16 16 16 LNG SPAs 1,290 1,317 1,263 1,251 1,246 1,222 1,223 1,068 113 - - Total demand 1,373 1,400 1,348 1,324 1,306 1,277 1,259 1,084 129 16 16 Source: ACCC Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.