ACCC: manufacturing now “impossible” with gas shortages

ACCC chairman Rod Sims (Reuters)

ACCC chairman Rod Sims (Reuters)

The Australian Competition and Consumer Commission (ACCC) has said LNG exporters should step up to help supply local manufacturers with gas, according to The Sydney Morning Herald.

ACCC chairman Rod Sims told a gas conference last Tuesday that gas prices, often above $20 a gigajoule, are making manufacturing in Australia uneconomic. Sims says at best, manufacturers will find it hard to plan and invest and at worst, they will go out of business.

Australian prime minister Malcolm Turnbull is going to meet with gas companies tomorrow to discuss how they will address the local gas supply issue.

Reserving gas from the major QLD gas projects could be difficult because they involve large local and international investors who have overcommitted to foreign buyers. 

“The three [Queensland] LNG producers … could not have foreseen that after their investment decisions were made east coast onshore gas exploration and development would be largely prevented,” Sims said.

Sims also said that state government bans in NSW, Victoria and the NT were adding to supply uncertainty.