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Qenos: gas market “dysfunctional”

Australian petrochemical manufacturer Qenos said greater cooperation between industry and government is needed to address high domestic gas prices.

Earlier this week, the Australian Competition and Consumer Commission (ACCC) released the latest instalment in its Gas Inquiry 2017-2025 Interim Report, which said domestic gas users on Australia’s east coast were currently paying $8-11/GJ, while the LNG netback price for 2021 deliveries has been below $5.50/GJ since May this year.

In response to the report, Qenos CEO Stephen Bell said this was clear example of how unfair the market has become.

“Australia is giving Japan, Korea and China a stable, competitive, long-term gas supply for industry and energy, yet the same suppliers are not offering the benefits to the domestic market,” he said.

“The profit made from Australian customers has become a huge subsidy to foreign users of Australian gas.”

Mr Bell said the 18 LNG export cargoes sold well below domestic prices could easily account for two years of Qenos’ total gas usage.

“There is no doubt that domestic industries and consumers are cross subsidising overseas customers,” he said.

“We need to find a solution together. The national interest requires greater cooperation between the States and the Commonwealth, as well as gas producers and energy intensive manufacturers, to establish a new domestic industry supply arrangement.”

Qenos is the only manufacturer of polyethylene and polymers within Australia.

For more information visit the Qenos website.

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