If you want to see a failed market in action, look at this chart.
While there was a debate about gas taxes and domestic reservation, the gas export cartel pushed the price lower to hoodwink the public.
Now it is over, and global prices are going nuts; the price is glued to the $12Gj price cap imposed by the government.
Frankly, I don’t understand why they don’t just push the cap lower to $7Gj. Voila! Abundant cheap gas as the cartel is forced to sell the low-cost stuff in Australia and export the more expensive.
Meanwhile, APA is building another pipeline.
APA Group’s proposed gas pipeline that would carry gas from the Beetaloo Basin to the east coast has been declared a “coordinated project” by the Queensland government, in a move that will streamline the approvals process.
The 899km North to East Australia Pipeline would link the emerging Beetaloo gas province into APA’s east coast gas grid, through a connection into the existing South West Queensland pipeline. It would enable gas from the remote region in the Northern Territory to reach LNG export plants in Gladstone more easily.
The Beetaloo is considered to have roughly 7500Pj of gas as 2C reserves, not yet proven.
This is enough to feed the entire East Coast for 14 years.
But this is not what should or will happen to this gas if the proposed domestic reservation is managed properly.
This is expensive gas. It will cost about $15Gj to pipe to VIC.
So, it will not be competitive if the proposed domestic reservation goes ahead.
However, if it is exported, it will be subject to the proposed domestic reservation.
It could be consumed in QLD. But, frankly, even there, at $11Gj, it is far too expensive.
This gas should go to Asia, so there is no issue hooking it up with the Gladstone cartel or Darwin LNG.
So long as Albo’s dills stick to their dictum that 20% of uncontracted and newly contracted gas must be oversold into the East Coast, then cheap gas should be displaced from exports and sold here.
Beetaloo can go east and north and resolve the exporter’s shortage.
If the proposed gas reservation is watered down at all, then the reverse will happen.
Beetaloo gas will be fed into Australia by the export cartel while it exports $1Gj gas from QLD.
This cannot be allowed to happen.
