Queensland May Expand Land Quarantine to Fix Local Gas Shortfall

  • Surat Basin coal seam gas supplies opened up for exploration
  • State seeks to manage LNG export projects with domestic use

The state of Queensland may expand the amount of land available for gas exploration to overcome looming gas shortages and high prices on the east coast of Australia.

A coal seam gas exploration program in the state’s Surat Basin, which plans to reserve gas for Australian use, may be expanded, according to a government statement Sunday.

“Urgent action is required to increase domestic gas supply to protect industry and to secure jobs,” said Queensland Natural Resources Minister Anthony Lynham. “We are looking at further and larger land releases in the Surat Basin with the same Australian market conditions.”

Natural gas prices for some customers across Australia’s patchwork power markets have jumped as exports rise from Queensland’s three liquefied natural gas projects while drilling bans in several states limit supply.

Prime Minister Malcolm Turnbull will hold a second meeting with gas producers on Wednesday to seek further supply commitments after receiving pledges from executives last month to raise production of the fuel. The meeting was in part triggered by a report showing the states of New South Wales, Victoria and South Australia face a shortfall of gas-powered electricity generation in the summer of 2018-19.

Other proposed measures by the Queensland government include new gas pipelines, which could be funded from the North Australia Infrastructure Facility, and federal funding of water study initiatives. Tenders close on April 20 for the initial Surat Basin exploration round.

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