– The ACCC considers it critical to gas market efficiency and long-term energy security that underlying barriers to domestic supply development are addressed.
– It is expected that supply shortages will arise from 2028 unless a new gas supply is established.
– “An efficient and well-functioning east coast gas market is critical to supporting Australia’s long-term energy security
– The East Coast has sufficient gas reserves and resources to meet expected domestic demand for at least the next ten years. However, a combination of policy, technical and commercial factors over the past fifteen years have hampered their development.
– Gas production is not coming online fast enough to meet demand, and we now expect continued shortages in the southern states as local reserves reach the end of their economic life. The market is now in the position of being reliant on uncontracted gas from Queensland and having to transport it long distances across the east coast.
– Governments can further support efficient and timely gas supply by addressing competition in upstream markets, addressing regulatory barriers to investment and developing a gas market system plan that affirms the role of gas during the energy transition and supports market-led solutions to achieve energy supply and security.
– The composition of expected supply remains a concern as significant volumes of east coast gas production are expected to come from projects in Queensland’s Surat and Bowen basins, while the supply of locally produced gas in the southern states declines.
The ACCC reports that the gas supply deficit will increase from approximately 300 PJ per year until 2037, which is more than double the entire consumption of NSW.
In a recent publication on gas supply to the Australian east coast energy market by Australian energy producers, the key points were made by CEO Samantha McCulloch:
“Natural gas will play a vital role in Australia’s energy mix to 2050 and beyond, but regulatory uncertainty, approval delays and policy interventions have delayed critical projects and damaged Australia’s reputation as a safe place to invest,” McCulloch said.
“Australia has abundant gas supplies and yet we face predicted gas shortages on the east coast from 2027 and in Western Australia from 2030.”
“Without new gas projects, Australian households and businesses will face higher energy prices, an uncertain energy supply and a greater risk of power outages that will affect every part of the economy.
Addressing these risks must be a national priority.”
“Australia and our region’s economic growth and energy security require a reliable and affordable gas supply, and this requires continued investment in the exploration and development of new gas,” Ms McCulloch said.
“The Australian gas industry contributes $105 billion annually to the Australian economy and supports 215,000 jobs. Natural gas provides approximately 40 percent of the energy used by Australia’s manufacturing sector, and in WA gas provides more than half of the energy used in mining and mineral processing.”
The CEO of the Australian Energy Market Operator (AEMO) has warned in a contribution to a study on the reliability of Australia’s electricity grid that the increasing penetration of renewables over the past decade has increased the risk of the country being unable to restart the grid during the day following a Spanish-type power outage – “insufficient new investment in the technologies that could replace coal’s grid stabilizing role in such situations, including synchronous condensers, grid-shaping inverters and gas turbines that can run without burning fuel.” burn.”
In a keynote address at the Climate and Energy Summit in May 2025, AEMO CEO stated: “flexible gas-fired generation will remain the ultimate backstop in a highly renewable energy system. Gas, alongside batteries and hydropower plants, will enable higher contributions to renewable energy and support reliability as coal-fired power plants retire. And importantly, new gas-fired power plants can play an active role in system security even when no gas is consumed.”
This is because their heavy-duty generators – such as coal and hydropower – have benefits beyond just generation. When designed and built with this functionality in mind, they can rotate freely to keep the grid safe and resilient without burning fuel.
For gas to play its crucial role as a backstop for reliability, there must also be sufficient gas in our domestic networks to meet demand.
Gas is still used as a heating fuel, as a raw material for production and as a fuel for generators. However, gas production is declining faster than demand in the southern states, reinforcing the need for investments in new gas supplies.”
About BPH Energy Limited:
BPH Energy Limited (ASX:BPH) is an Australian Securities Exchange listed company that develops biomedical research and technologies within Australian universities and hospital institutions.
The company offers early stage financing, project management and commercialization strategies for a direct partnership, a spin-out company or to secure a license.
BPH provides funding for commercial strategies for proof of concept, research and product development, while the institutional partner provides infrastructure and key scientific expertise.
BPH currently collaborates with several academic institutions, including the Harry Perkins Institute for Medical Research and Swinburne University of Technology (SUT).
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