Coalition's Gas Policy Faces Scrutiny Over Feasibility and Industry Backlash

Peter Dutton's proposal to reserve uncontracted gas for domestic use aims to lower energy prices but has drawn skepticism from experts and criticism from the gas industry.

• The Coalition's gas reservation policy seeks to redirect 50-100 petajoules of uncontracted gas annually from Queensland's LNG exports to the domestic market, aiming to lower wholesale gas prices from $14 to $10 per gigajoule.
• Experts question the feasibility of achieving significant price reductions due to rising production costs and market dynamics, with new gas production costs often exceeding $9 per gigajoule.
• The gas industry warns the policy could deter investments in new gas supplies, disrupt market operations, and harm relationships with long-term LNG buyers in Asia.
• Major gas users, particularly in manufacturing, have welcomed the plan, citing the need for lower energy costs to remain competitive in a gas-rich nation.
• The policy, introduced as a central element of the Coalition's election strategy, includes a $1 billion investment in gas infrastructure and promises to reduce regulatory barriers for new projects, though implementation details remain unclear.

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