The WA market has escaped disruption from LNG exports due to a much-lauded policy for liquefied natural gas projects to reserve 15 per cent of their gas for domestic use.
Industry consultancy EnergyQuest recently labelled gas in WA as the cheapest in major industrialised countries,however a shortage between 2025 and 2027 predicted by the Australian Energy Market Operator in 2021 could cause prices to jump.
On Wednesday,the DomGas Alliance – which includes South West alumina producer Alcoa,Pilbara fertiliser and explosives manufacturer Yara,Wesfarmers’ chemical and fertiliser operations and Coogee Chemicals – called for the reserved gas to be offered to market instead of staying in the ground.
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It is understood that gas supply from Woodside’s Pluto LNG project is a particular concern of the gas buyers. While former WA Labor Premier Alan Carpenter’s 2006 deal with Woodside has been held up as what should have been done on the east coast,it has delivered little gas.
Woodside had no obligation for the first five years of gas exports and there is doubt the deal was legally enforceable.
The current Labor government worsened the gas supply outlook when it exempted for five years Beach Energy’s Waitsia gas project in the Perth Basin from its ban on the export of onshore gas. Otherwise,Waitsia’s gas from 2023 to 2028 would have more than covered the predicted shortfall.