Biggest gas user welcomes supply fix

TASMANIA’S largest industrial gas user, Grange Resources, has welcomed the Federal Government’s move to ensure a domestic gas supply by restricting exports.

Prime Minister Malcolm Turnbull announced the Australian Domestic Gas Security Mechanism, which will give the Government the power to impose export controls on gas companies when there is a domestic supply shortage.

Grange operations manager Ben Maynard said the moves to improve security of supply and reduce gas costs were a relief to the company.

“While we are not certain of the outcome, we are pleased that the Prime Minister has sent a clear signal to suppliers that they need to supply domestic industries,” Mr Maynard said.

Grange uses about a third of the state’s gas at its Port Latta iron ore pellet plant on the North-West Coast.

Mr Turnbull said up to 65,000 jobs across the nation could have been at risk if the Government had not acted.

He said wholesale gas prices of up to $20 a gigajoule were being quoted to customers but expected gas prices could halve to less than $10 a gigajoule.

Australia is set to become the world’s largest exporter of liquefied natural gas by 2020 but there have been warnings of shortages in domestic supplies.

A Hydro Tasmania spokesman said: “We welcome efforts to help boost domestic gas availability and limit price rises.”

Hydro Tasmania, which owns the Tamar Valley Power Station, negotiates gas transmission prices on behalf of Tasmanian gas users.