According to the Australian Energy Market Operator (AEMO), southern and southeastern Australian states will have to import LNG by 2024 to avoid gas shortfalls on peak winter days, as the southern gas supply is forecast to fall by more than 35% over the next five years. Indeed, several existing gas fields in Victoria are expected to stop production between mid-2023 and mid-2024. Consequently, new gas fields could be developed and gas pipelines should be expanded - at least pipeline capacity limitations should be addressed - to delay shortfalls until 2026.
The state of New South Wales (NSW) plans to add 70 PJ (around 2 bcm) of gas supply into the energy markets by 2022, from the Narrabri coal seam gas project or from LNG imports. Several LNG import and regasification terminals are under consideration in Australia, including AGL Energy's 3.8 bcm/year Crib Point LNG project in Victoria (by 2022), ExxonMobil's import terminal project in Victoria, 2.2 bcm/year Port Adelaide LNG project in South Australia, 2.7 bcm/year Port Kembla LNG project and 8.4 bcm/year Newcastle LNG project in New South Wales.
Most of Australia's gas production is sourced from three basins: the Gippsland Basin (Victoria, declining), the Cooper-Eromanga Basin (central Australia) and the Carnarvon Basin (north-west Western Australia), while coal bed methane (CBM) production is almost entirely concentrated in the State of Queensland (98%). Gas production has been increasing rapidly in recent years, mainly for exports. In 2017, the AEMO projected that the growth in LNG exports could cut gas volumes for the domestic market by 20% between 2018 and 2021, threatening domestic power supply. In addition, domestic gas prices soared, prompting Australia to enact a law to control LNG exports from the three LNG plants - namely Gladstone LNG (GLNG), Australia Pacific LNG (APLNG) and Queensland Curtis LNG (QCLNG) - on the east coast, where most of the population and industry are located. Supply tensions eased and in 2018 the Australian government decided not to implement LNG export controls in 2019.