Australia’s conservative Liberal-National federal government has ruled out introducing a national gas reservation policy, labelling it “ideological claptrap”.
The Industry Minister Ian Macfarlane said household gas prices in the nation’s most populous state, New South Wales, were likely to rise as it faced a gas shortfall in 2016.
AAP Newsagency reports Mr Macfarlane said it was up to the NSW politicians to stand up to anti-coal seam gas (CSG) activists who were delaying important domestic gas projects.
“There is no good reason for reservation policy. It is ideological claptrap,” Mr Macfarlane told AAP on the sidelines of the Australian Petroleum Production and Exploration Association (APPEA) conference in the West Australian state capital, Perth.
“You haven’t got the gas in NSW to reserve and in Western Australia, if you ask anyone they’ll tell you it’s corrupted the market and affected supply.”
AAP reports he said the federal government would destroy the nation’s sovereign risk profile if it prevented the export of unconventional gas from Queensland or tried to control the price of domestic gas.
“In the end, this is a NSW issue. There’s not much we can do and there’s not much we’re prepared to do.”
Mr Macfarlane said he was unsure how NSW would meet demand without pushing ahead with CSG projects.
However, he said, the government would “see what happens” in relation to providing assistance to manufacturers.
The minister confirmed NSW households would pay more for gas but said there was unlikely to be shortages this winter.
He also predicted offshore floating LNG projects would ramp up alongside existing large onshore projects in WA, Queensland and the Northern Territory capital, Darwin.
After significant delays, Mr Macfarlane urged Woodside Petroleum and its partners to push ahead with its Browse floating LNG project off WA.
“We need to get on with Browse. We lost a lot of time on James Price Point,” he said.
Meanwhile, Santos vice president of Eastern Australia James Baulderstone said 100,000 manufacturing jobs on Australia’s east coast were at stake as 45 per cent of the industry relied on gas.
“If we can’t get sufficient supply, particularly supply in NSW, the only state that effectively doesn’t produce any gas at the moment, there are severe consequences,” he said.
An inability to supply gas would ultimately affect people’s standard of living, he said.
