Australian manufacturers have cast doubt on prime minister Turnbull’s gas plan to pressure gas producers to reserve local gas. They say that they have only vague assurances that they will get any new gas in the short term, according to the AFR.
Gas producer Santos said that it is looking at freeing up gas for the local market but did not give specific detail. Origin Energy and Shell said they were currently writing contracts for customers and have already made gas available.
Besides any gas these companies may reserve for manufacturers, they have no incentive to search for more gas for the domestic market.
Citigroup analyst Dale Koenders said that prices would need to be high enough for reservation to occur.
Koenders said any promises around any extra gas would be fleshed out at the next meeting of chief executive officers with the prime minister scheduled for a month’s time.
The analyst said that the prime minister’s promise to accelerate gas trading nationally and improve pipelines may provide relief to manufacturers in the short term.