The Australian Domestic Gas Security Mechanism (ADGSM), designed to ensure domestic gas supply, officially came into effect on Saturday, 1 July.
Minister for Resources and Northern Australia, Senator Matt Canavan, said the 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 Australian Competition and Consumer Commission (ACCC) and industry to determine later this year whether 2018 will be a shortfall year, and whether export licences will be necessary from 1 January.
“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,” said Minister Canavan.
“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.
“I have been pleased by the constructive approach from LNG producers in discussions since March as we have developed new guidelines and regulations to give effect to the new mechanism.”
Minister Canavan said the Government’s longer term goal was to increase the domestic gas supply and boost competition, and improve transparency and efficiency of the gas market supply chain.