January 20, 2013

Readers of Saturday’s alarmist article in the Weekend Australian (Gas boom won’t keep the home fires burning), that baldly stated “Australia is about to become a gas-rich country that cannot supply its domestic needs” should be assured that Australia has more than enough natural gas from sandstones and coal seams to cover domestic and export needs for more than 80 years.

And that doesn’t take account of natural gas from shale gas which is estimated by Geoscience Australia to more than double those resources.

Clearly, claims that Australia is running out of gas are baseless. But we need to get on with the job of developing our gas resources and bringing them to market.

Natural gas exports actually increase investment in Australia’s natural gas development by many billions of dollars each year.

Governments can play a role by removing regulatory and planning barriers to the safe and responsible development of our gas resources for domestic and export use.

But government has no place at the table in a commercial negotiation over volumes, price, duration and other contractual terms. A commercial negotiation should remain just that – one conducted between buyers and sellers.

Calls for special treatment for domestic gas customers amount to a form of resource nationalism and a return to the flawed industry policy Australia abandoned in the 1980s.

Just as for coal, wheat, and iron ore, Australia’s long-term national interest is best served by maintaining access to open and competitive markets for natural gas, not by reverting to protectionist sentiments.