Gas trigger unfairly targets us: Santos

SANTOS and its international partners on the $US18.5bn ($26.6bn) GLNG project in Queensland have railed against a plan by the Albanese government to extend a gas trigger mechanism, arguing the project would be the only one targeted from the government intervention.

The government is reviewing the Australian Domestic Gas Security Mechanism amid a national energy crisis sparked in part by a squeeze on gas supplies for users.

The mechanism, known as the gas trigger, can force big LNG exporters to divert supplies from their Queensland

plants to domestic users if a local shortfall is declared.

However, the GLNG venture is the only project drawing gas from the domestic market, placing it in net deficit and meaning Santos and its partners – Malaysia’s Petronas,

France’s Total and South Korea’s Kogas – would have to shoulder the shortfall burden themselves, given they fail to meet the “net contributor” test.

With a broader review of the scheme also under way, Santos told the government it was against the plan to extend the scheme until 2030.

“Santos does not support the long-term extension of the ADGSM before it is reviewed because the mechanism currently targets Santos and our GLNG partners. No other exporters would be materially impacted,” Santos submitted.

“The ADGSM, if implemented, would intervene in long-term gas contracts with GLNG customers in Korea and Malaysia, countries with which Australia has free trade agreements. Conversely, the ADGSM, if implemented, would not restrict the export of spot LNG cargoes by other Gladstone LNG projects which have gas excess to their contractual requirements.”