Gas shortfall may not happen: industry

An industry expert says the predicted shortfall in gas may not happen because LNG exporters are turning their attention to the domestic market.

Bill Shorten speaks to the media at the Qenos Altona plant.

Bill Shorten says more gas development is needed, but must be done in consultation with communities. (AAP)

A peak industry body says there are signs a shortfall in gas for the domestic market in January 2019 may not eventuate.

The Australian Energy Market Operator reported in March a projected decline in gas production could lead to a shortfall of gas-fired electricity generation, pushing up the risk of 2019 summer blackouts in NSW, Victoria and South Australia.

AEMO warned this was because exports of liquefied natural gas were being put ahead of shoring up domestic supplies.

The Turnbull government has been seeking to put pressure on the gas industry to ensure there is enough domestic supply, threatening export controls if adequate action is not taken.

But Australian Petroleum Production and Exploration Association chief Malcolm Roberts says the country's three major LNG projects are turning their attention to the domestic market and have identified extra supply for 2018.

Mr Roberts said the AEMO forecast from March needed to be updated, as consultants Wood Mackenzie had recently forecast a shift in the supply shortfall trouble-spot to 2021.

A summary of the Wood Mackenzie report said additional volumes made available for domestic use had pushed the shortfall back.

"We are doing our best to supply more gas into the market," Mr Roberts told Sky News on Thursday.

He said the government should hold off on pulling the so-called gas trigger until more information was made available.

Labor has called for the government to act immediately.

"We don't have the forecasts, we don't have the intelligence yet," Mr Roberts said.

"If there's a finding there is a shortfall likely in 2018 I'm sure each of those (three) projects will look at what they can do - no one wants to see a shortfall of supply in the domestic market."

He said part of the solution lay in NSW and Victoria - which have moratoriums in place - allowing an expansion in gas production.

Mr Shorten said he was favour of more gas development in Victoria, but it must meet certain conditions.

He said "wherever" conventional gas was available "we should be pursuing it".

"I think it is reasonable if we can extract gas in Australia conventionally, safely, in consultation with communities, I think we do need to look at that, absolutely, yes," he said.

AEMO expects to update its forecast early next week.


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Source: AAP


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