Oil and Gas News

WA gas supply set to rapidly shrink: AEMO

Western Australia’s potential supply from existing and prospective gas projects is expected to meet forecast demand until the end of 2028, according to Australian Energy Market Operator (AEMO) analysis.

The 2020 WA gas statement of opportunities (WA GSOO) found that supply is expected to exceed demand until 2026, with supply and demand balance tightening in 2027 and 2028.

AEMO executive general manager Cameron Parrotte said the WA GSOO noted that there were options to alleviate the gap, including undeveloped gas fields not currently in the forecasts, that may be developed to serve the domestic gas market.

The report also forecasts an annual decline in potential gas supply of 2.8 per cent between 2021 and 2030.

“This decline is in line with reserve depletion at existing production facilitates and comes as liquefied natural gas (LNG) projects, including Browse and Scarborough, have been delayed due to market dynamics, exacerbated by economic conditions resulting from the COVID-19 pandemic,” Parrotte said.

However, AEMO is confident that major gas-consuming projects and commodities are forecast to lift demand at an average rate of 0.7 per cent.

COVID-19 conditions have increased the appetite for WA commodities, particularly iron ore and gold, which is expected to support domestic gas demand in the short-term to 2022.

“With the continued uptake of renewables and behind-the-meter solar generation, including the entry of large-scale renewable energy generation capacity in 2020, GPG in the South West Interconnected System (SWIS) is expected to decline at an average annual rate of 0.4 per cent,” Parrotte said. 

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