Representatives from the gas industry have warned government that there is an urgent need to tackle the barriers to supply which are driving up prices.

In a forum chaired by Industry Minister, Arthur Sinodinos, and supported by Minister for Environment and Energy Josh Frydenberg MP, and the Minister for Resources and Northern Australia Senator Matt Canavan, some of Australia’s largest industrial gas and energy users explained how the cost pressures from rising gas prices are threatening their businesses and the jobs of their employees.

Industry representatives included Manufacturing Australia, Australian Industry Group, the Energy Users Association of Australia and Major Energy Users Association, as well as representatives of large gas users, Incitec Pivot, Adelaide Brighton, Qenos, Australian Paper and BOC.

Industry noted that following the Prime Minister’s meeting on 15 March 2017, they were seeing the early signs of movement in the market, with some indicating that they were now beginning to receive more meaningful offers.

The Ministers reaffirmed the Government’s concern for businesses facing large increases in gas prices.

Echoing the Prime Minister’s warnings to the gas industry on 15 March, 2017, the Ministers reiterated the warnings that if gas companies fail to guarantee supply and improve the market through greater transparency and competition, the Government will act to protect the domestic industry and jobs.

Australia’s manufacturing industry representatives gave examples of critical gas pricing and supply issues both as energy users and as essential inputs to manufacture. High prices, or onerous conditions on contract threatened international competitiveness.

The industry said gas producers must engage in meaningful negotiations and that governments across the country should do more to encourage new production and new producers.

The Government said it will continue to work with all parties to find immediate and longer term solutions to this crisis.

Ministers will meet with pipeline operators in the last week of March 2017, ahead of further talks with LNG producers, and will continue to work with all parties to ensure that industries and communities are supplied with reliable supplies of gas at a fair price, at a time when Australia becomes the world’s largest producer of LNG.

Utility Journalist

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