October 22, 2012

Perhaps the call for gas producers to subsidise big domestic gas users has more to do with self-interest than the national interest that its advocates claim.

The latest demand for subsidised gas is from DomGas Alliance Executive Director Gavin Goh in an October 22 letter to the editor of the Australian Financial Review.

The Australians employed (the sector created more than 100,000 Australian jobs this year) and businesses that have benefitted from the growth of a $175 billion LNG industry would seem to tell a different story to the picture of gloom repeatedly painted by those calling for a domestic gas reservation policy.

Gas reservation policies actually impair local gas supply and affordability – not improve it. Having laws dictate where and how gas can be sold invariably deters the very investment needed to source Australia’s abundant gas reserves.

Establishing more effective regulation, including less duplicative planning processes and more timely approval processes is the answer to securing future supplies of gas for both domestic use and export.

Australia does not allow exports in an “open slather” way as suggested by the DomGas Alliance.

Western Australia has a state policy that influences exports from that state and Queensland goes through a Gas Market Review process each year.

David Byers is APPEA’s Chief Executive. This blog post is an edited version of a letter published in the Australian Financial Review on October 23.