Leaving the farcical hysterical hubub from the Lefties.
Now for some REAL utter incompetence by the imposter Vic Labor Disgrace.Victoria to face gas shortfalls by 2021 unless new supply brought onlineMar 28 2018 at 10:16 PM Updated Mar 28 2018 at 10:16 PM
Victoria will experience gas shortages within 3 years unless additional supply is brought online, according to a new report by the energy regulator.
Victoria will experience significant gas shortages within 3 years unless additional supply is brought online, which could have flow-on effects for the whole National Electricity Market, according to a new report by the Australian Energy Market Operator.
The report – which mirrors similar concerns about NSW's gas supplies and prompted Malcolm Turnbull last year to declare a national energy crisis – will put more pressure on the Andrews Labor government to lift its moratorium on onshore gas exploration in Victoria. The moratorium has been heavily criticised by industry and federal Energy Minister Josh Frydenberg.
The AEMO report to be released on Thursday found that, despite falling gas consumption in the state, Victoria was on track to have a shortfall of up to 36 terajoules on a very cold winter day in 2021, increasing to a 220 shortfall on a severe winter day in 2022 and a 109 terajoule shortfall on similar days after that.
This was driven by a 38% fall in annual gas production from the Gippsland Basin below 2018 production forecasts and a 68 per cent fall from Port Campbell, mostly due to some offshore fields ceasing production.
Gas prices could be on the rise in Victoria. John Woudstra
The projected shortfall in Victoria could also have implications for other states, including Tasmania which receives 20 terajoules of gas across the Bass Strait every day. It could also force up gas prices which have been front and centre of the national political debate over the past 12 months.
AEMO's forecasts of a supply shortfall in Victoria are consistent with the results of a study commissioned by the federal government and advice delivered by the Australian Competition and Consumer Commission late last year.
Slow progressThere have been similar predictions about a gas shortfall in NSW which doesn't have a moratorium but where gas projects, such as Santos's $3.6 billion Narrabri development, have been progressing very slowly.
AEMO's executive general manager of operations, Damien Sanford, said the market operator was hoping the report would encourage a market response to help fill the gap, but warned some intervention may be needed if the private sector does not come up with a solution.
"We anticipate these signals will encourage the market to respond accordingly with solutions with adequate resources to enable us to operate the gas system securely and reliably," Mr Sanford said.
"We could do that [intervention] but we will have an update later this year on projects to address the shortfall."
Some of the ideas being discussed with industry include additional sources of gas supply such as peak day capacity, increased production and storage capacity, additional pipeline import capacity into Victoria as well as a liquified natural gas import terminal.
The shortfall forecast by AEMO confirms gas buyers' fears of a looming steep decline in local Victorian gas supplies which is expected to add upward pressure to prices in Victoria as it becomes increasingly reliant on gas from Queensland, which incurs $2-$4 a gigajoule in transport costs.
ExxonMobil, which manages the Gippsland Basin venture, the biggest source of gas offshore Victoria, has declined to provide expected output figures, saying only that its 2018-2020 output should be in line with average production in 2011-15, before the record rates seen in 2016-17.
Import terminalOther new sources of supply, such as Cooper Energy's $605 million Sole gas project, won't be enough to offset the decline from mature fields.
The supply gap also appears to reinforce the justification for AGL Energy's proposed LNG import terminal in Victoria, which would bring in gas from overseas or from Western Australia to supplement local supplies. AGL is targeting a decision in 2018-19 on the $300 million project, which could start up in 2020-21.
It comes as federal Resources Minister Matt Canavan said the east coast gas market would be boosted with additional supplies from four projects to be funded under the Turnbull government's $26 million gas acceleration program.
The projects – including three in Queensland and one in South Australia – would supply an extra 12.4 petajoules of new gas to the east coast gas market by mid-2020 and an extra 27.6 petajoules over five years.
"The only way to provide gas security into the future is by increasing the supply of gas through increased development," Senator Canavan said.
"We can access our plentiful gas resources in a responsible and balanced way, using the best available science. I encourage all states and territories with limitations on gas projects to re-think their blanket bans."
http://www.afr.com/news/politics/victoria-to-face-gas-shortfalls-by-2021-unless-...
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