The state of Victoria in southern Australia has enacted a permanent ban on shale gas and coal seam gas hydraulic fracturing ("fracking"), due to concerns of environmental groups and farmers over groundwater depletion and contamination risks. Victoria's gas supply is mainly covered by offshore fields in the Bass Strait. The state will extend a moratorium on onshore conventional gas drilling until 2020; it would then reassess the risks and onshore conventional gas drilling could be allowed after 2020.
A similar ban on fracking is expected to be adopted in the Northern Territory, which would block production in the Beetaloo Basin; Armour Energy estimates its unconventional gas potential resources at 30 Tcf (nearly 850 bcm).
The gas industry and the Australian Petroleum Production and Exploration Association fear that the Victoria ban may have nationwide impacts and may reduce Australian gas supply, as three large LNG export terminals are under construction in Queensland and should triple gas demand in eastern Australia by 2018 (compared to 2014 levels).
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