Gas chiefs plead for investment certainty as energy talks loom

The gas industry intends to use upcoming talks with the Albanese government to bring an end to months of bitter conflict and uncertainty over a slew of interventions it claims has turned Australia into a high-risk destination for investment.

Large gas producers such as Santos, Woodside, Chevron and Shell, which have raked in record profits since Russia’s invasion of Ukraine roiled global energy markets, are now under mounting political pressure amid government efforts to restrain energy bills, raise more funds for cost-of-living relief, and curb planet-heating greenhouse gas emissions.

The nation’s $91 billion gas industry responded angrily to the introduction of many of the policies, including a temporary $12-a-gigajoule limit on domestic gas prices, warning that the changes threatened to freeze investments in new domestic gas supplies. Some new gas projects in Victoria and Queensland have been paused already.

Samantha McCulloch of the Australian Petroleum Production and Exploration Association, which represents the nation’s biggest oil and gas companies, said improving the “investment environment” was critical to avert the growing threat of gas shortfalls in the nation’s south-east as traditional supplies from offshore fields in Bass Strait dried up.

“The fact we have seen so many projects put on hold and investments paused at a time when the Australian Competition and Consumer Commission and Australian Energy Market Operator are projecting supply shortfalls, for us, underscores the urgency of getting that policy certainty in place and enabling the investment environment so these supply projects can move forward,” she said.

“We are committed to working with the government to resolve the uncertainty that’s been created over these recent months.”

Speaking before a key industry conference in Adelaide this week, McCulloch welcomed the announcement in the federal budget that the government would invest $6.7 million developing a “Future Gas Strategy” with an aim to balance energy security, affordability and decarbonisation.

“The call on gas is increasing but the investment environment to bring on new supply to meet that demand hasn’t been there,” she said.