According to the Australian Energy Market Operator (AEMO), Australia should face a gas shortage as of 2024, as gas production from the ageing Gippsland Basin fields off Victoria, which have long been the main gas supply source for the states of New South Wales, South Australia and Tasmanian, is expected to decline. Gas supply to those states could then fall from the current 150 PJ (3.6 Mtoe) to 23 PJ (550 ktoe) in 2023.
A gas shortage in eastern states could be avoided by developing new gas reserves, increasing gas pipeline capacity or by starting importing LNG. 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.
Gas demand for power generation, which has remained stable since 2015, could exacerbate the forecast gas shortfall. It will depend on weather, the growth of solar and wind power generation and expected closures of coal-fired power plants, such as AGL Energy's Liddell power plant due to shut down in 2022.
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