States must pull own weight on gas: Govt

The state and federal governments are at loggerheads over the best way to resolve a looming shortfall in gas supply for Australian needs.

Government is pressuring states on gas production.

The Turnbull government is putting pressure on the states to increase gas production. (AAP)

A gas crisis looms for Australian households and industry but governments at all levels are pointing the fingers elsewhere.

The Turnbull government has accused NSW and Victoria of not carrying their own weight on national energy supply, saying they must free up gas developments.

The states are pushing back, instead urging the federal government to immediately pull the trigger on restrictions to gas exports.

But Queensland - home to the three large export terminals many say are at the root of the problem - has cautioned against hasty federal action that could lead to job losses in that state.

The federal government received a pair of reports on Monday warning of a shortage of gas in 2018 of up to 108 petajoules - about three times larger than previously forecast.

The shortfall is about one-sixth of the east coast's total projected demand for gas, equivalent to the annual household usage of 100 regional cities.

Australia is producing more than enough gas for its own needs but nearly three-quarters of it is slated for sales overseas.

The consumer watchdog has discovered at least one exporter is planning to send more gas overseas than it has to - gas that could otherwise be used within Australia.

Prime Minister Malcolm Turnbull has threatened to trigger export controls if gas companies fail to make more domestic supply available.

But he also criticised NSW for not moving quickly to approve new gas projects, and Victoria for its moratorium on both conventional and coal seam gas exploration.

Treasurer Scott Morrison said export control was a short-term mechanism and the nation needed a long-term solution.

"We are walking around on top of the gas in NSW and Victoria that our economy needs, and the jobs that depend on that gas need, and it is important that this be freed up," he told reporters in Sydney on Tuesday.

"New South Wales - and Victoria - has to carry its own weight when it comes to gas supplies and it is not doing it at the moment."

Both he and Mr Turnbull singled out a gas project Santos wants to develop at Narrabri in northern NSW, which is in the midst of an approvals process.

NSW Premier Gladys Berejiklian says Santos only lodged its application for that development earlier this year.

"New South Wales is the most resilient state when it comes to all sources of energy," she told reporters.

She called for a national approach to energy supply - an issue she will raise at the next Council of Australian Governments meeting.

"No matter what a great decision NSW takes, no matter how we secure our own energy, this requires a national approach," she said.

Victoria's Labor government also has defended itself, saying the state historically produced more gas than it consumed.

"Malcolm Turnbull can no longer ignore the facts and must immediately act to restrict LNG exports," a spokesman said.

But acting Queensland Premier Curtis Pitt says that would have a detrimental impact on jobs in the LNG industry, and his state shouldn't be punished for other jurisdictions' shortcomings.

"I think Malcolm Turnbull is thinking too small," he told reporters.

Mr Turnbull will meet with gas companies Santos, Origin Energy and Shell later this week.

He wants concrete plans on how they will address domestic gas supply concerns.


Share
4 min read

Published

Source: AAP


Share this with family and friends


Get SBS News daily and direct to your Inbox

Sign up now for the latest news from Australia and around the world direct to your inbox.

By subscribing, you agree to SBS’s terms of service and privacy policy including receiving email updates from SBS.

Download our apps
SBS News
SBS Audio
SBS On Demand

Listen to our podcasts
An overview of the day's top stories from SBS News
Interviews and feature reports from SBS News
Your daily ten minute finance and business news wrap with SBS Finance Editor Ricardo Gonçalves.
A daily five minute news wrap for English learners and people with disability
Get the latest with our News podcasts on your favourite podcast apps.

Watch on SBS
SBS World News

SBS World News

Take a global view with Australia's most comprehensive world news service
Watch the latest news videos from Australia and across the world