The Australian Pipelines and Gas Association (APGA) says stable gas policy is vital to increasing industry investment.
APGA’s statement is in response to an Australian Competition and Consumer Commission (ACCC) report highlighting the need to lower energy prices.
The ACCC Gas Inquiry 2017-20 Interim Report, released today, outlined how more investment in gas exploration and development would help bring more gas to market and lower prices.
APGA CEO Steve Davies said recent periods of policy uncertainty had discouraged investment in the country’s gas infrastructure.
“Energy infrastructure projects, like gas transmission pipelines, benefit from long-term policy and regulatory certainty as they are long-lived assets that take many years to recover the full investment,” he said.
“That’s an important element that has been missing for quite some time.
“It is crucial that we do not lose sight of this as we head towards a federal election.
“After all, delays in getting the settings right pose an increasing risk to Australia’s gas-dependent manufacturing sector and we cannot risk losing that.”
ACCC Chair Rod Sims said high gas prices were making it difficult for businesses to survive, with the east coast potentially facing an industry exodus.
“Some commercial and industrial gas users have told us that, at these prices, which are two to three times higher than historical prices, their operations are not sustainable in the medium to longer term,” he said.
“They are increasingly likely to relocate from the east coast or close their operations.
“Once large manufacturers relocate or shut down their plants, they won’t come back.
“The timing of the development of uncontracted proved and probable reserves is critical for the east coast gas market.”
ACCC will monitor whether gas producers are developing gas in a timely manner until the conclusion of the inquiry and will provide its next interim report to the Federal Treasurer in April 2019.
For more information visit the APGA website.
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