Victoria could face gas shortages in the early 2020s, with potential export controls likely to exacerbate this problem, according to AGL Energy.
The Australian reported AGL Executive General Manager Wholesale Markets Richard Wrightson has warned gas supplies from Queensland will start to dry up in the early stages of the next decade and interventionalist policies from the major political parties on exports and imports could dissuade potential investment.
“I can understand the desire to look at ensuring that those prices are capped, but the negative is are you discouraging investment as you try and halt the problem,” he said.
“Obviously with this policy what will be key is where the price is set and will it discourage investment, and it will be a difficult and dangerous thing if it did.”
AGL is in the process of developing its own LNG import facility at Crib Point in Victoria, with an aim to have the project operating by 2020–21.
Mr Wrightson said AGL predicted coal seam gas from Queensland would become more expensive in the future with a view that “there’s going to be physical constraints on supplying gas to southern markets.”
Earlier this week, Santos CEO Kevin Gallagher was also critical of potential export controls after Labor leader Bill Shorten said his party planned to introduce a permanent trigger on regulations if in power.
Mr Gallagher said intervention in commercial export deals would decrease foreign investment in Australian projects, leading to less supply and a loss of jobs.
Santos is also looking to build its own LNG import facility, with its and AGL’s the second of four import development projects in the pipeline for southeast Australia.