The Australian government’s control on gas prices is set to be extended a further 18 months until mid-2025 as outlined in a draft code of conduct for the gas industry released Apr. 26.
The government set a temporary A$12 per gigajoule limit on gas in December 2022 after it received Treasury warnings that energy prices were set to soar upward by as much as 50% during 2023 and into 2024 (OGJ Online, Dec. 13, 2022).
The government now wants to establish a code of conduct to begin in 2024 which, it says, will ensure sufficient supply of Australian gas for Australian domestic users at reasonable prices while still giving producers the certainty they need to invest in supply.
The draft code proposes to extend the existing cap until July 2025.
It also introduces a range of exemptions for smaller gas producers that only supply gas for domestic use as well as for any larger producers who commit to tightly defined enforceable undertakings to produce and supply gas into the domestic market at a reasonable price ahead of time.
It would also ensure Australia remained a reliable trading partner by enabling LNG producers to meet their export commitments, the government said.
Energy Minister Chris Bowen said the aim is to ensure that producers do not revert to earlier unregulated export practice at yearend.
The Minister said he wants to cut the link between volatile international gas prices and the prices Australian industries and households pay for gas supplies.