Shell said the proposal might change the terms of the "Heads of Agreement" commitment the three east coast liquefied natural gas (LNG) exporters - Australia Pacific LNG, run by ConocoPhillips, Gladstone LNG, run by Santos Ltd and Queensland Curtis LNG, run by Shell - made in September to prevent a forecast supply crunch. Under that deal, Shell's QGC arm had offered gas for 2023 and 2024 for domestic customers through an expression of interest (EOI), but on Tuesday said it was pausing the process.
But producers are more concerned about the government's proposed long-term "reasonable pricing" regime that would set gas prices at the cost of production plus an agreed profit margin after the one-year price cap expires. Top independent gas producer Woodside Energy Group said Labor's plan would deter investment in new supply, rather than meeting the government's goals of beefing up energy security, lowering energy bills and boosting renewable power.
EIG’s Blair Thomas says gas from Australia is crucial to the global energy transition for the next 20 years, providing the price stability needed to keep public support.
Santos and Woodside Energy will rake in billions of dollars of extra profits this year due to the war in Ukraine, but analysts say the gas producers are only now offsetting earlier heavy losses.
MidOcean Energy, an LNG company formed and managed by EIG, has entered into a definitive agreement with Tokyo Gas Co., Ltd to acquire Tokyo Gas’ interests in a portfolio of four Australian integrated LNG projects.