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Earlier this month, the Federal Government agreed to investigate the gas market in order to bring down prices in return for gaining support for its tax cuts from other political groups.

But Jemena Managing Director Frank Tudor said an attempt to lower prices through government intervention was an ultimately short-term and short-sighted solution to current issues.

“As a result of misaligned policies across state boundaries – which have seen gas reserves locked up in some states – and energy policy uncertainty at the federal level, Australia’s east coast domestic gas prices have more than trebled,” he said.

“This makes east coast gas some of the most expensive in the world.

Jemena Managing Director Frank Tudor.

“Remedying this situation relies not on further reform but rather a fundamental shift in our country’s gas supply versus demand equation.

“Simply put, if Australian gas prices are to return to acceptable levels additional gas must be brought to market.”

Mr Tudor said both industry and consumers needed an environment that encouraged new investment in gas and facilitated the unlocking of new supplies.

“Freezing investment, by introducing further regulatory uncertainty, will only serve to increase the price of gas over the long term,” he said.

“As appealing as greater regulatory reform may appear, in the long term this will only serve to drive up gas prices.”

Mr Tudor’s view has been mirrored by other industry figures, including Australian Petroleum Production and Exploration Association (APPEA) Chief Executive Andrew McConville, who recently said that market intervention could “adversely affect confidence in the oil and gas sector”.

As yet, the government has not outlined what action it will take on gas, it has previously signalled the possibility of limiting LNG exports to divert supplies back to the domestic market.

For more information visit the Jemena website.

If you have company news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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Gas Today by Dconvery - 22h ago

The energy analyst reported LNG exports in the 2019 financial year had continued to increase, with the total export revenue over the 12-month period estimated to be $50.5 billion.

Australia exported a total of 1,111 cargoes and 75.1 million t of LNG in FY19, a 21.2 per cent rise from FY18’s 61.7 million t, which was good enough to fall just behind Qatar’s 77 million t as the world’s top LNG exporter.

EnergyQuest expects production over the current year to increase again to 80 million t, which should see Australia assume the top spot.

This increase will be fuelled by a ramp up in production of INPEX’s Ichthys LNG Project and Shell’s Prelude Floating LNG development, the latter of which exported its first LNG cargo in June.

Australia’s biggest customer over the year was Japan, which accounted for 41 per cent of the nation’s exports, while China and South Korea followed with 37 per cent and 10 per cent of exports respectively.

Japan is the biggest market for west coast exports, while China is Queensland’s biggest customer.

For more information visit the EnergyQuest website.

If you have news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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Lattice has been granted authority from the Victorian Government’s Earth Resources Regulation to advance its Enterprise Project, located near Port Campbell off Victoria’s southwest coast.

The project involves drilling deep under the ocean floor via a technique known as extended reach drilling, which avoids any impact on the marine environment and begins from the land onshore.

Lattice has successfully used the technique previously at a nearby site and has produced gas there since 2016.

Earth Resources Regulation will monitor the project’s progress and ensure its safety and environmental standards are met, while the development is expected to attract at least $50 million in investment.

Earth Resources Regulation Executive Director Anthony Hurst said the approval would help move the project further along.

“Lattice Energy can now proceed to seek final approvals and continue to engage closely with the local community to keep them updated with on-site activities,” he said.

“We will ensure that Lattice Energy fulfils its regulatory obligations to protect people and the environment.”

Earth Resources Regulation is a branch of the Victorian Government’s Department of Jobs, Precincts and Regions.

For more information visit the Beach Energy website.

If you have company news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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Additionally, the company has formally lodged an Environment Protection and Biodiversity Conservation (EPBC) Act referral for the pipeline, which would transport gas from Galilee Energy’s Glenaras Gas Project in Central Queensland to the east coast domestic market.

Galilee is currently undertaking commissioning activities at Glenaras, having drilled three lateral wells for its pilot program this year.

The company has reported observing strong initial productivity during the testing phase of the Glenaras 14L well, while final completion of pre-commissioning site works are being finalised for the 15L and 16L wells.

Galilee had budgeted $8 million for the lateral drilling campaign and anticipates three months of production drawdown will be required in order for material gas production rates from the wells to be observed.

Jemena General Manager Strategy and Business Development David Green said the submissions reflected the confidence the company had in the Glenaras project.

“The encouraging early results from this pilot are a credit to the Galilee Energy team,” he said.

Galilee Managing Director Peter Lansom said project was moving forward with the team working hard to bring the Glenaras wells online as soon as possible.

“I would like to congratulate Jemena on their outstanding progress on the Galilee Gas Pipeline,” he said.

“This is further evidence that Galilee is moving at pace to achieve its objective of supplying material gas volumes into the east coast gas market.”

Front end engineering and design work on both the pipeline and gas field are targeted to begin later this year, with an objective of first gas to market in 2020.

Galilee is 100 per cent owner of the Glenaras project.

For more information visit the Jemena website.

If you have project news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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The WA State Government released an implementation plan outlining its proposed actions in response to the findings of the independent scientific panel inquiry into hydraulic fracture stimulation.

The plan, which can be accessed online, was developed by a Senior Officials Steering Group co-chaired by WA’s Department of Water and Environmental Regulation (DWER) and Department of Mines, Industry Regulation and Safety (DMIRS).

The steering group will action specific government policy decisions, including obtaining consent from Traditional Owners and private landowners before stimulation takes place; maintaining the existing ban in specified regions; banning hydraulic fracturing in national parks and other iconic natural heritage areas; referring proposals to the Environmental Protection Authority (EPA); and strengthening regulations to ensure high health, safety and environmental protection standards are met.

“DWER is committed to protecting the state’s water resources and environment to enable thriving communities and a strong economy,” said DWER Director General Mike Rowe.

“The implementation plan includes a number of safeguards such as the referral of all onshore exploration and production applications for hydraulic fracturing to the EPA for assessment.

“The plan also prohibits hydraulic fracturing within 2,000 m of gazetted public drinking water source areas.”

DMIRS Director General David Smith said WA has robust resource regulations and that he is confident the plan will reinforce this strong regulatory framework.

“The state has a long history of safe and responsible oil and gas operations, and the steering group will work hard to maintain this world-class approach,” said Mr Smith.

For more information visit the WA DMIRS website.

If you have news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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Under the terms of the deal, Cooper will supply Visy with 7.6 PJ of gas from Sole for three years starting January 2020, with the potential for an extension of a further three years.

The gas will be supplied via the Orbost Gas Plant at current market prices and Cooper Managing Director David Maxwell said further discussions with customers for Sole gas were ongoing.

“Visy joins O-I Australia as the second large industrial manager supplied by Cooper Energy,” he said.

“We are delighted to add another industrial user of gas to our customer portfolio under a multiyear supply agreement.”

All offshore construction operations on the Sole field have been completed, with production wells now successfully connected to the Orbost plant.

APA Group is currently completing the project’s onshore operations to upgrade the gas plant to process gas from Sole, and Cooper said it is anticipated the facility will be ready in the September quarter of this year.

Located in the Gippsland Basin, the Sole gas field is being developed to supply approximately 24 PJ/a to the market, with more than 75 per cent of its reserves already contracted to a range of utility and industrial customers.

For more information visit the Cooper Energy website.

If you have company news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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Gas Today by Dconvery - 22h ago

Earlier this month, the Institute for Energy Economics and Financial Analysis (IEEFA) released Towards a Domestic Gas Reservation in Australia, which suggested big gas producers in Australia had been taking advantage of customers and the solution to bringing down prices was a full domestic gas reservation policy fixing prices at $5/GJ.

The Australian Petroleum Production and Exploration Association (APPEA) has hit back at the claims in the report, particularly the view that Australia’s high electricity prices are caused principally by high gas prices.

“Gas does not set the price of electricity across the national energy market in Australia,” said APPEA Chief Executive Andrew McConville.

“There are many reasons why Australia has electricity affordability issues, including that wholesale and retail markets are too concentrated; poorly designed regulation and policy have added significant costs to electricity bills.

“Prices for new supply have risen as a result of rising production costs and supply restriction caused by the impact of bans and moratoriums in southern states.”

Mr McConville said IEFFA included misleading information in the report about Australia’s gas prices compared to other countries, citing a recent survey by the International Gas Union (IGU) which found Australia paid below the average amount in comparison to Asia.

Additionally, Mr McConville said Australia needed to follow the leads of countries like Canada and the US where the gas markets set wholesale prices, rather than enact a gas reservation policy.

“These nations do this for a good reason; gas reservation actually makes worse the situation it’s supposed to fix,” he said.

“A domestic gas reservation policy would act as an implicit tax on Australian gas production that diminishes incentives to invest in future gas production and exploration.

“The best way to create downward pressure on gas prices is more gas, not more regulation.”

The Federal Government is currently investigating ways to decrease gas prices on the east coast, where customers can currently pay up to $7 more than in Western Australia.

If you have news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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According to The West Australian, Mr Frydenberg and the government are investigating ways for the east coast market to access WA gas, which can be up to $7 cheaper than current levels.

“West Australians get access to gas that is cheaper than on the east coast of Australia and any opportunities to ensure there are lower gas prices on the east coast of Australia we will investigate,” he said.

“There was work done previously looking at infrastructure between the east and west coast.”

“People have talked about LNG import terminals. There are a whole lot of ideas that have been talked about in order to bring some of that west coast gas to the east coast.”

Last week, in order to pass its tax cuts, the government made a deal with the Centre Alliance to investigate a gas reservation policy and try to bring down prices, with Centre Alliance Senator Rex Patrick saying at the time the two groups were “close” to having a plan in place.

WA gas prices are not linked to the east coast market and benefit from an abundance of supply.

Ideas previously floated to link the east and west have included the construction of a mammoth gas pipeline, although no solid plan for this has ever been put forward.

Earlier this year, former WA Premier Colin Barnett called an east-west pipeline “an absolutely doable project” and said “it would solve the [gas] crisis”.

Companies such as Woodside have previously opposed the idea.

If you have news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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The 60 km gas pipeline and compressor station will transport gas from Senex Energy’s Project Atlas in the Surat Basin to market via the Wallumbilla Gas Hub.

Jemena has enlisted Spiecapag Australia to construct the pipeline, while Valmec has been contracted to build an associated compressor station.

Jemena Executive General Manager of Gas Markets Antoon Boey said the pipeline should be commissioned before the end of the year.

“We are currently in the early stages of construction, with around 90 people on site conducting clear and grade and stringing activities, and we expect this work to ramp up quickly over the coming weeks,” he said.

Mr Boey said Jemena would continue to invest in infrastructure to bring new gas supply to Australia’s east coast market.

Senex Managing Director and CEO Ian Davies said the pipeline would be deliver gas that is “much-needed”.

The pipeline will be 8 inches (203 mm) in diameter, buried at a depth of 1,200 to 2,000 mm and will  have the capacity to transport 40 TJ of gas per day.

During the lifecycle of the project, almost 200 jobs will be created.

For more information visit the Jemena website.

If you have company news you would like featured in PPO contact Assistant Editor David Convery at dconvery@gs-press.com.au

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AGL said it now expected first gas from the Victorian project to be delivered in the second half of the 2022 financial year, an extension from its original goal of FY2021.

The company intends to moor a floating storage and regasification unit (FSRU) at the Crib Point Jetty south of Melbourne and connect it to the existing gas network via a new pipeline to be constructed by APA Group.

But the plan has attracted significant criticism and opposition from locals as well as Health Minister Greg Hunt, who is the representative for the federal seat of Flinders where the project is located.

The project is currently undergoing an environmental examination at the state level and will require both state and federal approval to proceed, with AGL expecting an outcome from these assessments to occur no earlier than late FY20.

Due to the delays, AGL has changed its selection for the project’s FSRU from the Hoegh Giant to the Hoegh Esperanza, citing the latter vessels later delivery window and more suitable timing and operational requirements.

If the project proceeds, AGL has said between 12 and 40 LNG ships per year would moor alongside the FSRU to resupply the vessel.

For more information visit the AGL website.

If you have company news you would like featured in Gas Today contact Assistant Editor David Convery at dconvery@gs-press.com.au

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