Who remembers using a piggy bank? As a child, you’d save one and two cent pieces; if you were lucky you might even get a silver coin to slide into the slot on the pig’s back. As the coins dropped you’d hear them clunk onto the others inside. Once the pig became heavy, with its tum full of coins, you’d go with your parents to the local branch of the bank, and deposit those coins into your own savings account. Saving for the future is a good plan.
According to the 2019 Gas Statement of Opportunities (GSOO) the gas supply-demand balance remains tight, with gas production in southern Australia continuing to decline. In 2021-2023, this decline will further reduce Victoria’s ability to export surplus gas supplies to SA and NSW and any gas supplies from Queensland will be limited by pipeline capacity.
The Australian government is addressing this continuing decline and saving for the future by its plan to proceed with a national gas reservation scheme on the east coast. Liquefied Natural Gas, or LNG, is a natural gas—predominantly methane—that has been cooled to -161°C so that it becomes liquid form. It is odourless, colourless, non-toxic and non-corrosive, making it safe for storage and transport.
Current LNG export projects in Western Australia deliver cleaner and more reliable energy to Asia, while also creating thousands of jobs and provide major export and tax revenue for Australia1. State government regulations mandate that 15 percent2 of gas reserves of LNG export projects are set aside for use in the state. It helps to ensure businesses that are doing it tough with energy prices are viable, to continue a vibrant manufacturing and processing sector in rural and regional areas.
The federal government hopes that a model similar to the successful LNG export industry can provide relief for manufacturers and industry struggling with high tariffs. The reforms for gas policy will respond to the tight supplies from reduced production for offshore Bass Strait, and will introduce a price measure to the gas export trigger.
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