Australian liquefied natural gas (LNG) producers have sufficient uncontracted gas to prevent a domestic shortfall, but the country’s east coast gas market could see a supply deficit if the producers export all their gas, a regulator said on Friday.

The Australian Competition & Consumer Commission (ACCC) expects a supply shortfall of 30 petajoules (PJ) in the country’s east coast gas market this year, should the LNG producers export all of their uncontracted gas.

“The east coast gas supply forecast for 2023 has improved, but the outlook remains uncertain as the LNG producers haven’t yet committed sufficient volume under firm contracts to address the risk of a domestic shortfall,” said ACCC Chair Gina Cass-Gottlieb.

The ACCC report comes after its warning last year, saying that extra gas was needed to offset declining output at offshore fields that have long supplied the populous east coast, home to nearly 90% of Australia’s population.

Australia’s east coast is expected to produce 1,983 PJ of gas in 2023 wherein most of the gas is expected to be exported overseas by three LNG ventures in Queensland under long-term contacts, according to the ACCC report.

The three LNG producers, who have been net withdrawers of gas from the domestic market for the last couple of years, have worsened the gas shortfall, the report said.

Australia had said in December it will cap coal and gas prices for a year in attempt to ease utility bills for households and businesses hit by soaring costs amid Ukraine conflict, a move that could deter future investment in supply driving down prices in long run.
Source: Reuters (Reporting by Navya Mittal in Bengaluru; editing by Uttaresh.V)