Any domestic gas reservation system imposed on Australia's eastern market will not be imposed on existing projects, energy minister Chris Bowen said, as Australia moves closer to importing LNG to its southern states ahead of a forecast supply gap.
The federal government is reviewing a suite of policies on capping prices and restricting exports on a quarterly basis in 2025 to address the upcoming gas shortage, and this review may recommend a reservation policy on new gas fields.
Australia's opposition party, which lost the 3 May election, had proposed taxing spot LNG exports from the three projects operating at Gladstone harbour on Australia's Pacific coast as part of efforts to limit exports and reserve more gas for the domestic market. But such a policy would not be adopted by the re-elected Labor government, the energy minister told ABC television on 1 June.
"We have a very clear matter of principle that we don't agree with sovereign risk, we don't agree with retrospective policy actions," Bowen said.
The comment comes after Victoria state, which has discouraged the use and drilling of gas in recent years, approved a proposal by Australian refiner Viva Energy to build an LNG import terminal near its existing facilities near the city of Geelong.
Weaker gas consumption and a series of subsidies to keep coal-fired power stations operating for longer in southern states has improved the eastern grid's supply for the next four years, the Australian Energy Market Operator said in March.
Australia's most advanced import facility, the 130 PJ/yr (3.4bn m³/yr) Port Kembla Energy Terminal operated by Squadron Energy, will now begin operating in 2027 at the earliest, with the 170,000m³ Hoegh Galleon floating storage and regasification unit to remain in service in Egypt until May 2026.
