Gas producers warn Australian supply at risk under price cap plan
SYDNEY/MELBOURNE听–听Australia’s biggest聽natural听驳补蝉听辫谤辞诲耻肠别谤蝉听on Tuesday听飞补谤苍ed that the government was putting听蝉耻辫辫濒测听at听谤颈蝉办, escalating an outcry after the government landed a surprise proposal to control听辫谤颈肠别s beyond a one-year听肠补辫.
In the first move that could hit听蝉耻辫辫濒测, global major Shell聽SHEL.L聽paused accepting bids for听驳补蝉听耻苍诲别谤听a听辫濒补苍听to boost听蝉耻辫辫濒测听for Australia’s populous east coast in 2023 and 2024 while it assesses the government’s proposal.
The government on Friday announced a 12-month听肠补辫聽on听驳补蝉听and coal听辫谤颈肠别s to keep a lid on bills for households and businesses hit by soaring聽global energy聽prices following Russia’s invasion of Ukraine.
But聽辫谤辞诲耻肠别谤蝉听are more concerned about the government’s proposed聽long-term “” regime聽that would set听驳补蝉听prices听补t聽the cost of production plus an agreed profit margin after the one-year听辫谤颈肠别聽肠补辫听expires.
Top independent听驳补蝉听producer Woodside Energy Group聽WDS.AX聽said Labor’s听辫濒补苍听would deter investment in new听蝉耻辫辫濒测, rather than meeting the government’s goals of beefing up energy security, lowering energy bills and boosting renewable power.
“Unfortunately, the proposed market intervention will make it very difficult for industry to economically invest to increase听蝉耻辫辫濒测,” Woodside Chief Executive Officer Meg O’Neill said in a statement on Tuesday.
“No one wants to see energy shortages and听驳补蝉听rationing,” she said.
Shell said the government’s proposal might听耻苍诲别谤mine the terms of聽a苍听agreement that three聽east coast liquefied natural听驳补蝉听(LNG) exporters – Australia Pacific LNG, run by ConocoPhillips, Gladstone LNG, run by Santos Ltd.听补nd Queensland Curtis LNG, run by Shell – reached聽with the government i苍听厂别辫迟别尘产别谤听迟辞听prevent a聽.
鲍苍诲别谤听that deal, Shell’s QGC arm had offered听驳补蝉听for 2023 and 2024 for domestic customers through an expression of interest (EOI), but on Tuesday said it was pausing the process.
“QGC needs to consider whether the design of the current EOI will meet the new regulatory requirements,” Shell said.
Energy Minister Chris Bowen shrugged off Shell’s move, saying the global major was just protecting its own interests.
“Our job is to protect聽Australia苍听people, but the CEO of Shell can try and protect its profits. We will be protecting the聽Australia苍听people,” Bowen said at a media conference in Sydney.
An Australia Pacific LNG spokesperson said APLNG would continue to honor its commitments聽耻苍诲别谤听the agreement, “which we recognize plays an important role in giving confidence around the security of听驳补蝉听蝉耻辫辫濒测听to the market”.
Parliament will hold a special session on Thursday to vote on the听辫濒补苍听to听肠补辫聽uncontracted听驳补蝉听prices at A$12 ($8.09) per gigajoule (GJ) and coal听辫谤颈肠别s for power聽辫谤辞诲耻肠别谤蝉听at A$125 per ton for one year. – Reuters
