AGL selling gas to exporter, says report

AGL is reportedly selling large amounts of gas to a company that exports it, but the energy company says the deal was agreed before fears of a shortage arose.

Energy company AGL, which is not a gas exporter, has reportedly been selling a large amount of gas that has been making its way onto the LNG export market.

The company has an agreement to supply Queensland's Gladstone Liquefied Natural Gas with 254 petajoules of gas over a period of 11 years, the Daily Telegraph reports. Gladstone sells the gas offshore.

AGL says the deal was inked before the closure of the Hazelwood power plant, leading to a potential gas shortage on the east coast and the prospect of soaring energy prices.

There is also an outcry over the cost of gas mined in Australia being sold to local companies at a significantly higher price than that paid by companies in foreign markets.