Mechanism to protect domestic gas supply
THE Federal Government will force the country’s LNG exporters to provide more gas to the domestic market if there is a shortfall in supply, thanks to a new legislative mechanism – the Australian Domestic Gas Security Mechanism (ADGSM), which is now in effect.
Minister for Resources and Northern Australia, Senator Matt Canavan, said the Australian Domestic Gas Security Mechanism (ADGSM) would allow the government to intervene, if necessary, to ensure adequate gas is available to Australian homes and businesses.
The minister will use assessments including from the Australian Energy Market Operator (AEMO), the ACCC and industry to determine later this year whether 2018 will be a shortfall year, and whether export licences will be necessary from January 1.
“AEMO’s revised gas forecast shows that domestic gas supply and demand remain finely balanced. We need to be able to act should critical gas shortages arise that might impact on manufacturers and households,” Minister Canavan said.
“These forecasts are welcome but while the potential for gas shortfalls remains we’re not going to roll the dice on Australian jobs.
“Securing our domestic gas supply should also put downward pressure on the price paid by Australians and should help to achieve parity between local and international prices.
“The LNG sector is important to our economy, through its substantial contributions to GDP, employment and business opportunities including in many regional and rural areas.
“But subjecting Australians to gas shortages while Australia becomes the world’s largest LNG exporter, is simply unacceptable.”