Samantha McCulloch, Chief Executive of the Australian Petroleum Production and Exploration Association.
I would like to begin by acknowledging the traditional owners of the land on which we meet, the Ngunnawal and Ngambri People, and I pay my respects to their elders past, present and emerging.
I thank the Committee for the opportunity to provide a short opening statement on behalf of Australian gas producers.
The Australian gas industry recognises that the rising cost of living is a major challenge for Australian households and businesses.
Our industry is working tirelessly to provide Australian households and businesses with a secure, stable and affordable supply of natural gas, while also doing our part to reduce emissions and support our shared goal of reaching net zero by 2050.
With the transition away from coal-fired power generation, and growing shares of renewables, the reliance on natural gas for secure and dispatchable power in Australia is increasing.
The single most important thing that Australian Governments can do today to put downward pressure on gas prices is to bring on more gas supply to avoid the structural shortfalls that regulators including the ACCC and Australian Energy Market Operator have warned will hit the East Coast from 2027.
To bring on new supply we need governments to prioritise projects that have stalled due approval delays and red tape, and to provide regulatory certainty to bring back investor confidence to secure Australia’s future energy needs.
We are already seeing how supply constraints on the East Coast are impacting on Australians’ cost of living.
The ACCC’s June 2023 Interim Gas Inquiry Report highlights there is not enough gas being produced in NSW and Victoria where huge populations rely on gas while uncertain regulatory regimes and bans are stifling investment in new supply, and relying on gas from Queensland.
The report states that shortfalls “would place continued upward pressure on prices in the domestic gas market, as well as pressure on the electricity market”.
As a result of the additional costs from transporting gas from Queensland, millions of NSW and Victorian gas users are paying an extra $2 per gigajoule whenever their state has to transport gas from Queensland.
Our industry is committed to working with governments and gas and energy users to ensure Australians continue to have access to affordable and reliable energy.
We are happy to take questions.
