2012 Gas Market Review Report released

Energy Minister Mark McArdle has released the 2012 Gas Market Review Report and reaffirmed the Newman Government’s commitment to an adequate domestic gas supply, as well as the state's developing liquefied natural gas (LNG) export industry.

The report analyses factors including future pricing, supply-demand balance and peak demand, as well as barriers to market growth and increased competition in Queensland.

Mr McArdle said the review found the dominance of LNG as a producer and customer in Queensland also created a high level of uncertainty for domestic supply, pricing and overall demand.

“Queensland is experiencing the benefits of a period of very high gas industry growth through the development of the LNG industry,” Mr McArdle said.

Mr McArdle said some major domestic gas users had raised concerns about affordability and security of supply, in terms of securing medium and long-term contracts.

“While our state’s growing gas supply industry will underpin strong economic growth in national and international gas export markets, a secure, accessible and reliable domestic gas supply is a key ingredient in supporting wider Queensland growth,” he said.

Earlier this month, the Newman Government held a high level meeting with the gas industry to address growing concerns about domestic supply.

Following the meeting, in a letter dated 11 September, 2012 the Australian Petroleum Production and Exploration Association Limited (APPEA) made the following statement:

“As agreed at the meeting AAPEA will continue to play a co-ordinating role in the event that a major gas user claims difficultly in sourcing offers for supply. In the first instance, we recommend that such companies be referred to the list of key contacts in selected APPEA member companies who handle enquiries from major gas customers which was provided to the Queensland Gas Market Advisor on 12 June 2012. Should further recourse be required, the Chief Executives of gas companies may be contacted, and APPEA is also available to facilitate contact between users and suppliers.”

“I will continue to monitor the situation,” Mr McArdle said.

Mr McArdle said the industry had assured him that there was more than enough gas in the ground to supply demand for both the export and domestic markets.

“Over the next 12 months, the gas industry should demonstrate it will deliver on the commitments it has made to support the domestic market,” he said.

The Queensland 2012 Gas Market Review Report is available at http://www.deedi.qld.gov.au/energy/gas-market-rev.htm

[ENDS] 27 September 2012

Media contact: Melanie Mayne-Wilson 0417 277 905