• 3 minutes Could Venezuela become a net oil importer?
  • 7 minutes Reuters: OPEC Ministers Agree In Principle On 1 Million Barrels Per Day Nominal Output Increase
  • 12 minutes Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 3 hours Could Venezuela become a net oil importer?
  • 9 hours Reuters: OPEC Ministers Agree In Principle On 1 Million Barrels Per Day Nominal Output Increase
  • 6 hours Tesla Closing a Dozen Solar Facilities in Nine States
  • 12 hours Saudi Arabia plans to physically cut off Qatar by moat, nuclear waste and military base
  • 6 hours Why is permian oil "locked in" when refineries abound?
  • 3 hours Gazprom Exports to EU Hit Record
  • 3 hours Could oil demand collapse rapidly? Yup, sure could.
  • 4 hours EU Leaders Set To Prolong Russia Sanctions Again
  • 3 hours Oil Buyers Club
  • 5 hours Oil prices going down
  • 1 day Teapots Cut U.S. Oil Shipments
  • 42 mins Saudi Arabia turns to solar
  • 20 hours Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 6 hours EVs Could Help Coal Demand
  • 12 hours China’s Plastic Waste Ban Will Leave 111 Million Tons of Trash With Nowhere To Go
  • 1 day Hot line, Macron: Phone Calls With Trump Are Like Sausages Best Not To Know What Is Inside
Oil Inches Higher On Strong Crude Draw

Oil Inches Higher On Strong Crude Draw

Oil prices rebounded on Wednesday…

Gas Deficit Threatens Australia With Power Shortages

Malcolm Turnbull

Australia is facing power shortages next year, resulting from a deficit of natural gas, and Prime Minister MalcolmTurnbull is blaming state governments for causing the situation by curbing gas exploration activity in the country.

On a continent filled with gas we are paying around three times for gas as another firm would in the United States,” Turnbull said, adding that he will convene an urgent meeting with gas company heads supplying the east coast, to discuss options for avoiding the crisis. At the moment, Australian gas is cheaper for Japan than for Australia, despite additional shipping costs of $2.78 (A$3.70) per gigajoule.

Onshore drilling for natural gas is restricted in Australia, but the country is the world’s second-largest exporter of liquefied natural gas extracted from offshore deposits.

Turnbull’s comments come after the country’s Energy Market Operator warned that the grid needs more gas-powered generation capacity in order to stave off shortages. The PM has noted earlier that climate change models used to estimate the costs of switching to gas from coal have gravely underestimated gas prices and the availability of the commodity for domestic consumption.

One local energy analyst also believes that looming power shortages are the result of bad politics. In fact, Bruce Robertson from the Australian Institute for Energy Economics and Financial Analysis calls the idea of power shortages an “absurdity.”

Related: Australia’s 100% Renewable Energy Grid

However, unlike Turnbull, Robertson lays most of the blame with gas companies, which, he said, were “sitting on permits, not developing them and restricting supply so they can make a lot of money.

The analyst them blamed both state governments and Canberra for not developing an adequate energy policy for the country, leaving the door open for such “absurd” events, despite warnings that focusing on exports and neglecting domestic supply could have adverse effects on the country.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • ben on March 09 2017 said:
    Could you please clarify the statement "onshore drilling for gas is banned in Australia"? Because drilling is still happening in the Cooper Basin, and that's about as "onshore" as you can get.

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News