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Eastern gas industry to promote economic and environmental prosperity

A submission by the Australian Petroleum Production & Exploration Association (APPEA) has said that developing the New South Wales gas industry will reduce energy price hikes and lower greenhouse gas emissions.

The ACIL Tasman study – Economic significance of coal seam gas in New South Wales – was included in APPEA’s submission to the NSW Legislative Council Coal Seam Gas (CSG) Inquiry.

The study shows that that unless NSW commercialises its gas resources, wholesale gas prices across NSW, Victoria, South Australia and Tasmania will rise between 20 per cent and 25 per cent (in real terms) by 2030, with electricity prices rising in all regions of Eastern Australia, and NSW wholesale prices rising an average of 7.4 per cent over the period 2020 to 2030.

APPEA Chief Operating Officer for Eastern Australia Rick Wilson said “NSW has significant natural gas potential resources, yet gas is used to generate less than 5 per cent of the state’s electricity. And of the gas used in NSW, about 95 per cent is imported from other states.

“The recent NSW State Budget highlighted that CSG is the type of new industry that NSW needs and can readily achieve.”?

Meanwhile, Queensland’s gas industry is set to create around 18,000 jobs, according to Employment Skills and Mining Minister Stirling Hinchliffe.

Upon releasing the Queensland 2011 Gas Market Review Report, Mr Hinchliffe said “Gas is good for the state’s economy and good for the environment with half the emissions of coal-fired power generation.”?

The Minister said the report shows that the state’s gas market will continue to grow, fuelled by increased demand to meet domestic and industrial gas supply, electricity generation and the emerging LNG export industry.

Energy Minister Stephen Robertson said that “Modelling undertaken for the report indicates there are more than sufficient gas resources to meet all demand in the medium to long-term and, given time, these resources can be converted to reserves for contracting,”? he said.

“Over the next few years there is a requirement to quickly convert sufficient resources to contractible reserves to support both export growth and new domestic contracts for supply in the period 2015 to 2020.”?

Mr Robertson said the Queensland Gas Commissioner advised there is a need for greater market clarity around activities planned to achieve gas reserves for domestic gas market supply.

“There is no doubt growing demand for gas to drive the LNG export industry will put pressure on our gas reserves.

“The newly announced carbon price is also expected to drive growth of gas-fired power generation.

“That is why the Gas Commissioner has recommended a series of measures to build the gas market and ensure we continue to have new and sufficient gas reserves available to meet all market expectations.

“Measures outlined in the Report are designed to expand wholesale gas market trading, improve access to incremental transmission capacity, increase distribution network utilisation and provide a solid legislative foundation for future dedicated gas storage facilities,”? Mr Robertson said.

The report, prepared annually by the Queensland Gas Commissioner, provides an analysis of the Queensland gas market in the context of the Eastern Australian gas market and LNG industry development.

It also informs government decision-making on the security of domestic gas supply, more effective resource management and the development of a more competitive gas market.

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