As Pacific Islands Forum meets, the government should admit we do not need more gas
Claims that LNG gas can’t be used to meet any shortages in south-east Australia are completely false given how much uncontracted LNG capacity Australia has over the next 20 years.
This week the Pacific Islands Forum meeting in Tonga will see leaders from the region address the dramatic impact of climate change and the urgent need to reduce emissions. It is an important moment for the Australian government to reject the lies of the gas industry and acknowledge that approving more gas will ruin the livelihood of the millions living in the Pacific Islands.
Gas is a massive contributor to greenhouse gas emissions (the clue is in the name!) that cause climate change. And given the world has just experienced 13 straight months of record setting temperatures, it is brutally clear that we need to reduce emissions quickly and with much greater urgency than has been the case over the past decade. But reducing emissions is not compatible with gas company profits, so gas companies and their boosters in the media routinely bring out a scare of gas shortages and with it calls for more gas.
Australians have gone through another winter without running out of gas despite being told earlier this year that a gas shortage was very much on the cards. And so of course now the gas industry is warning that a gas shortage could still occur because… well… because the gas industry knows that the only way it can justify demanding the government approve new gas mines is if people think we are about to run out.
Of course, we already know that 80% of Australia’s gas is either exported as LNG or is used to convert natural gas into LNG for exports. But gas companies however argue Australians cannot count this gas as theirs because it can only be exported.
In a March 2023 Senate committee hearing on the Cost of Living, the Chief Executive Officer of the leading gas lobby group, the Australian Petroleum Production and Exploration Association (now renamed Australian Energy Producers), Samantha McCulloch, told senators that “that gas was produced in large part because of plans to access the export market. Essentially, it wouldn’t have been produced without that export market there. When those facilities were built, they had long-term supply agreements with our trading partners in Japan, Korea and elsewhere, so there is a very strong export market.”
And so the gas industry argues that Australia has a gas shortage, and that gas converted to LNG can’t be used to meet any “shortage” because of the long-term supply agreements in place. However, analysis of the government’s Future Gas Strategy and AEMO reports shows this line is just an excuse because the uncontracted capacity of LNG well exceeds that of any supposed shortage.
From these reports we know the amount of gas currently contracted for exports, this enables us to calculate the level of uncontracted gas relative to current export outputs. This analysis reveals that by the middle of the next decade, when the annual gas shortage in South East Australia is predicted to be equivalent to 3MT of LNG, Australia will have around 53MT of LNG export capacity that currently has no export contracts.
That means a mere 5% of that uncontracted gas could be used to meet any potential “shortage”. The reason gas companies have not agreed to do so is because they hope to make greater profits selling the gas overseas.
If gas companies were to agree that they could easily supply enough gas to meet any shortage here in Australia that would also make it clear that there is no need for more gas fields.
The reality is that Australia is not about to run out of gas, gas companies just want to make people think we are to limit the political backlash if the government approves new gas mines. Any new gas mines however are not need to prevent any supposed shortage, but they would produce more emissions that drives climate change and endanger the livelihoods of the millions of Pacific Islander peoples
Australia does not need more gas, and Australians should not fall for gas industry spin that we are about to have a shortage. And importantly, it is time the government makes it clear to those in the Pacific Inlands that Australia will stop approving new gas mines and fields.
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