The Queensland Government has put forward a proposed package of initiatives to the Federal Government to address the east coast gas shortage, including options to develop new gas pipelines.
Natural Resources and Minister Dr Anthony Lynham put a package offer to his Federal counterpart Senator Matt Canavan, offering Queensland’s gas resources for Federal support, including funds for new gas pipelines.
“Urgent action is required to increase domestic gas supply to protect industry and to secure jobs,” Dr Lynham said.
“Queensland is already ahead of the pace with the measures we have underway, including land on offer where the gas will be for sale in Australia only.
“We are looking at further and larger land releases in the Surat Basin with the same Australian market conditions.
“There is a lot more that can be done, and we believe those actions should be funded by the Commonwealth in the national interest.”
Dr Lynham has sought an urgent meeting with Senator Canavan to discuss the Queensland proposals, including:
- A jointly funded study into infrastructure options
- Guaranteed funding, possibly from the North Australia Infrastructure Facility, for any viable options – like new pipelines – that will deliver gas to the Australian market
“Access to new pipelines would make all the difference in opening up new potential gas producing areas like the Bowen and Galilee Basins,” Dr Lynham said.
Dr Lynham said addressing groundwater management would also support further gas production, because a key concern of landholders was the impact of gas extraction on groundwater.
“Queensland has managed groundwater concerns with an Office of Groundwater Impact Assessment and the development of a basin-wide cumulative groundwater model and monitoring program,” Dr Lynham said.
“Developing more basin-wide water models would generate the landholder confidence we need to widen gas production into other prospective areas of the state.”
Dr Lynham also called for the Commonwealth to continue funding the Great Artesian Basin Sustainability Initiative (GABSI), which subsidises the rehabilitation of water-wasting uncontrolled flowing bores.
To date, GABSI and its predecessor programs saved around 200 972 megalitres per annum from the Great Artesian Basin, but the program is due to end in mid-2017.
“Ending GABSI sends a poor message to landholders and community at a time when Governments are actively seeking to accelerate gas development that will require the use of water resources,” Dr Lynham said.
APPEA Queensland Director Rhys Turner said Dr Lynham’s willingness to engage with the Commonwealth, including to develop new pipeline infrastructure, echoes what the industry has been saying for some time.
“Developing new fields to bring more gas to market is the most important part of the equation right now,” Mr Turner said.
“Exploration is at a 30-year low. Regulatory costs and delays are discouraging development as well as adding to the cost paid by our customers.
“We must also avoid an infrastructure deficit. Queensland has promising gas fields that can be developed in the Galilee and Bowen Basins. Unfortunately, there is a real risk that this gas may be stranded because of a lack of pipeline infrastructure.
“The first, best solution is private investment in competitively priced infrastructure. However, if the market fails, Dr Lynham’s call for the Commonwealth to support infrastructure has merit and is worth considering.
“At the very least, the Queensland Government and the Commonwealth should be congratulated for having a mature discussion to address serious issues.
“Disappointingly, governments in the south-eastern states continue to have their heads in the sand when it comes to looking at new ways to increase the country’s gas supply. They still prevent local projects yet expect the industry to supply their markets.
“The gas industry stands ready to work with governments across the country to boost supply if governments have the political will.”