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Byron Shire
March 1, 2021

Gas prices set to soar

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Chris Dobney

Gas producers AGL and Origin Energy are each seeking a retail price increase of approximately 20 per cent in the coming 12 months, which they blame on the massive new gas export facility in Queensland.

And there are further planned price hikes on the way.

Gas marketers have been touting a ‘shortage’ of gas in NSW for some time as their rationale for needing to tap CSG resources but they have been forced to admit that the so-called shortage has been caused by the opening up of the Gladstone gas terminal, putting Australian gas prices on a par with the rest of the world for the first time.

According to the Independent Pricing and Regulatory Tribunal (IPART), ‘retailers have proposed significant increases in regulated retail gas prices. These are largely based on rising wholesale gas commodity costs, as the development of the LNG export market in Queensland increasingly links domestic gas prices to international prices’.

The proposed increase would see the average annual gas bill rise by $182/year in Sydney and up to $239/year elsewhere in the state.

Lock The Gate Alliance (LTG) has used the announcement to again call on the NSW Resources Minister, Anthony Roberts, to pull back from state government support for CSG mining in the state, saying ‘the greatest threat to gas prices in NSW is the CSG export industry itself’.

Lock the Gate national coordinator, Phil Laird described the export of coal seam gas as ‘a lose-lose prospect’.

‘Not only are farming communities in being told they must pay the price of greedy gas companies wanting to export Australia’s precious natural resources, but now we’ve had confirmation that ordinary NSW households are also being asked to foot the bill for the gas export industry,’ he said.

We’re threatening our water supply, digging up forests, threatening farmland, and for what? For gas price hikes?’ he added.

As gas exploration is causes increasing conflict with farmers around the state, LTG says it is time for the government to back farmers’ rights to say no to gas mining on important farmland and to protect the water resources that sustain rural communities.

The NSW government is currently proposing changes to the Petroleum (Onshore) Act that would weaken protection for landholders in dealing with gas companies.

‘The fact is that opening up NSW for CSG drilling will not only lead to massive price hikes in domestic gas but will also harm our best food-producing land and precious water supplies.

‘We’re calling on minister Roberts to meet with farmers as a matter of urgency to discuss the many options available to protect farmland and water resources from CSG and deliver NSW energy needs from other sources,’ Mr Laird said.

The Nature Conservation Council of NSW has supported LTG’s concerns.

Its campaigns director Kate Smolski said a key industry figure had already admitted there was no ‘gas shortage’.

‘Senior gas industry executive Ian Little just last month publicly acknowledged there was no looming gas shortage in NSW,’ she said.

‘Mr Little’s comments flatly contradict assertions by Minister Roberts and former minister Chris Hartcher, which we believe have been part of a carefully calculated campaign to promote expansion of the CSG industry in New South Wales at any cost,’ Ms Smolski added.

‘Many in the gas industry would like us to believe that public opposition to coal seam gas is the reason for the impending price increases.

‘The real issue is that permitting widespread development of coal seam gas fields will put our water resources, productive farmland and wildlife habitat at serious risk, but do nothing to contain gas prices for NSW consumers,’ she said.

An IPART decision on the price hikes is due in June. The tribunal is accepting public submissions, which can be made here.


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9 COMMENTS

  1. This is the greatest con yet. It has been obvious for years from here in Queensland. The problem is that the first Queensland gas fields, that were created … without any real scrutiny because they were for domestic purposes, have now been included in the gas for sale to the international market.
    The other problem is that in the short term QGC has sold more gas than they have available, so the Swanbank gas-fired pwer station is being closed for three years to allow that gas to be used to help meet the shortfall. This requires the re-opening of the Tarong Coal Fired Power Station. And that is probably not so bad as there is a good chance that Coal is cleaner than CSG.
    Graeme

  2. Total manipulation in that I can clearly see their agenda in saying if you people don’t let CSG in you the people will pay for it big time in elec and gas costs. Corporation scammers in bed with the government without doubt

  3. Confected shortages are the “modus operandi” of monetarist commercialism. Three things stand out in this issue: 1: There is no shortage of produced fuel gas overall in Australia. To claim there is, is deceptive and misleading.
    2. There is indication that the price for exported gas is lower than that being asked of local consumers. This is immoral, if substantiated. Resources are not for private monopolies to screw vulnerable customers. Let’s have some honest disclosure of costs !
    3. Higher prices mean more GST for the State Government. It is not surprising that State Government sits on it hands while monopolists pillage constituents. But the real immorality is that the “carbon tax” is being trumpeted as a cause of the price hike. If that is so, do we not have the illegality of a tax on a tax ?

  4. As always…it’s about the mighty dollar. We mere minions are going to pay dearly, so a very few people can make huge profits. …. Most of it going to overseas companies. Large corporations are allowed to pillage & plunder, all in the name of bigger profits. It’s disgusting. It’s way past time that successive Govt’s stopped selling us down the drain.

  5. This is the biggest rort in recent years. I thought Australia was one country and one economy but the QLD government and QLD gas producers won’t agree to sequestration of some of QLD’s Gas production for NSW consumption. With the inevitable pressure on NSW gas prices and on farmers and local communities to accept fracking and csg wells on their land and in their communities. NSW used to consume a lot of QLD’s gas production but now QLD is preferring to export that production to China, Japan and Korea who are willing to pay far more than domestic users. So we have the ridiculous situation where gas production is booming but supply and prices in NSW are tightening and going up respectively.
    Time for people and politicians to work out a system of sequestration of OUR natural resources where emough production is set aside for Domestic consumption (in all states) and the price should be (get this!!!!) The Cost of Production plus 10-15% as a reasonable profit margin for the extracting company. Contracts to extract and supply gas and other resources should be tendered out. That way, the people of Australia actually get to benefit from the resources they own, not just Mining Corporations.

  6. World parity pricing….happened with petrol and is happening with Gas!! and we are surprised? When it is cheaper to close the Stanwell Gas powered electricity generating facility in Queensland because
    1. (What a surprise) Solar is forcing elec prices down (and some spuik it like it is a bad thing!!)
    2. They can sell the gas abroad at a better price than they can get generating electricity with it

    A world of contradictions…..maybe bentley won’t be worth the effort Peter (let us hope so)

    And by the way, I look with absolute horror at the number of arrests of good people who oppose tyranny. I thought that using confected special law to crush good citizens in favour of rapacious corporations was on the wane.
    Clearly not. God help my grand-children

  7. The manipulative tactics are becoming so transparent one wonders why they bother?

    Sell our gas to overseas interests. Tick.

    Claim we have a shortage. Tick.

    Import the same product (our national resource) back at hugely inflated prices. Tick.

    Scaremonger about the escalating cost of energy to the householder in a bid to terrify people into supporting polluting, myopic and irresponsible industry. Tick.

    Wake up one morning to the realisation that, despite all the fairytales they’ve been spinning, there REALLY is an issue with climate change, everyone, including their own kids, now know who is to blame, and, oh, yes, that we live in a gasland, thank you very much. Tick!

    Heads out of the sand, please ,”representatives’ of the people! How on Earth can some people live with themselves?

  8. A number of the comments here are delusional…

    “solar is forcing elec prices down” – are you kidding? Solar subsidies by governments (because solar is not cost effective on its own) are pushing electricity prices up for everyone

    “sell our commodities overseas” – are you kidding? Natural gas is the ONLY COMMODITY in eastern Australia that is not sold overseas currently. Maybe we should ban the export of wool and wheat so Australian consumers can have lower prices on those too? Let’s ban the export of our technology too. Let’s ban the export of our solar technology so the Chinese don’t get ahead of us… [do you really want that?]

    “as always… it’s all about the mighty dollar” – come on? If you go to work, what do they pay you in, peanuts or lima beans or what? Of course in making an economy efficient it’s all about getting the dollars to work for us so we get the highest standard of living. That’s why you aren’t currently out in a field tilling the ground with a hoe (like millions of Indians or Chinese) but you are sitting at a desk writing on a computer – you have a higher standard of living then many others in the world. And that standard of living is generated by our strong economy which in a large part depends on mining of all sorts of commodities that give you an excellent standard of living…

    • It’s not about banning exports but realising that the Minerals in our country belong to the people, not to corporations with enough finances from banks to exploit these resources. Enough production, where there is a large resource available, should be allocated for domestic commercial and consumer use at a price that represents the true cost of production.
      It is NOT a level playing field. China bans exports of Rare Earths to use them in local production. The US heavily subsidises its auto industry as does Europe. In Australia, both major parties subscribe to this right wing economic rationalism that local industry and households must pay world parity prices for the resources that we have in our country already. WHY?
      Economic theory says each country should produce goods where it has a comparative advantage. Australia’s comparative advantage is not cheap labour, or having lots of capital; it is having huge resources like coal and gas and iron ore etc. If local industry could buy these resources at cost of production plus a margin of profit for extraction then we would not have thousands of jobs being lost or going overseas and we would all have a much higher standard of living.
      Think outside the box…

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