2025 AUSTRALIAN DOMESTIC GAS OUTLOOK – SYDNEY
Good morning
For those of you who have heard me speak before, you know I always like to start my speech with the most basic Federal Budget fact: mining pays the bills for Australia.
But of course, as everyone in this room knows, I should be more precise: it’s mining and drilling that pays the bills.
Because when our resources sector is strong, our nation is strong. It has never been any other way.
The Coalition loves the jobs your industry creates; we love the revenue your industry raises; and – as much as it may make many in this room cringe – we love the tax you pay.
We know the resources sector floods the federal government’s coffers with $42.5 billion in company tax.
We also know from last week’s Federal Budget that in 2024/25, Medicare cost $42 billion.
Basically, company tax from the resources sector alone funded the entire – entire – Medicare system.
No budget comparison better illustrates just how much Australians everywhere – every day – in every community – from every walk of life – rely on the income of a flourishing resources sector.
Specifically, the gas sector contributes $17 billion in taxes and royalties to the federal and State governments.
And what is that the equivalent of funding?
In the most recent report of the Pharmaceutical Benefits Scheme,
$17.7 billion is what it cost for the supply of medicines under the PBS. That’s what it is equivalent to funding.
As well as underpinning State and Federal Budgets, our resources sector – including gas – underpins our energy needs; our manufacturing needs, our trade needs, our defence needs, our employment needs; and our standard of living.
When I first accepted the invitation to speak with you today, I didn’t know this event would fall within the opening week of a Federal Election campaign; and nor did I know it would be on the heels of a Federal Budget… a federal budget where the Federal Treasurer never once mentioned the words ‘gas’ or LNG in his entire budget speech.
There was however a section of his speech titled “New Energy Rebates”.
But there was no section titled “New Energy Projects”; there was no section titled “New Energy Approvals”; and there was no section titled “New Energy Jobs”.
And that goes to the core of the choices facing Australians – in about 5 weeks’ time – when we go to the ballot box.
Unlike the trio of Labor, Green and Teals; the Coalition doesn’t duck and weave and cower at the mention of gas.
Gas underpins our nation’s future: and the future of our trading partners and our allies.
As Peter Dutton emphasised in his Budget Reply speech, gas is key to our country – as it is around the developed world – to manufacturing, food production, making electricity, and keeping the lights on.
As he said: “you can’t run a full-time and functioning economy using part-time and unreliable power”.
Domestically, gas underpins our ability to ease the cost of living pressures for families across Australia; to ease the costs on business of doing business; and to ease the costs on the manufacturing sector that is so at risk – dangerously at risk – of gas shortages.
As at August 2024, electricity and gas prices had gone up by 32 per cent (without rebates) and 34 per cent respectively, since the change of government almost three years ago.
The Coalition’s energy plan will deliver a balanced energy mix with gas, renewables and zero-emissions nuclear.
And we plan to turbo-charge our mining and gas sectors by accelerating approvals and cutting red and green tape.
The Coalition – unashamedly – wants to unlock more Australian gas to safeguard our energy security and reliability, by increasing exploration and development.
As a part of our plans to get Australia back on track, we are determined to restore our nation’s hard-earned reputation as a reliable trading partner, and a dependable ally.
But before I step through in more detail how our plan delivers on those objectives, I want to outline how Australia – with its abundance of gas reserves – has become enveloped in a national gas emergency due to insufficient supply.
In this room, of all rooms, I am not going to step through the maze of explaining market forces, market indicators, market trends, and pricing.
This room is familiar with all those issues more than anyone else could be.
At its core, however, Australia has an abundance of natural gas and abundance of domestic and international demand for that gas.
Yet we have a national gas emergency due to insufficient supply: and with industry talking about having to import gas back into Australia.
This emergency is not the fault of industry; not the fault of consumers; and not the fault of our valued trading partners.
It is the fault of failed government policy.
It is the fault of failed policy regimes – that have in common being State and Federal Labor Party policy regimes – that:
- delay or prohibit
- duplicate
- drive-up the costs of
- fund and sanction activist
- freeze the release of exploration
- strangle investment with 1970s-style Industrial Relations’ policies; and
- obsess about an industrial-scale ‘renewables only’ roll-out that is resulting in higher prices; and a grid that is increasingly reliant on weather-dependent and unreliable energy sources.
Never before have we seen a set of government policies so deliberately designed to make us all poorer.
It’s little surprise then, that last Thursday – the same day as the Opposition Leader’s Budget Reply – the ACCC released its update on the east coast gas supply-demand outlook for the third quarter of this year that warned, and I quote:
“The east coast outlook for quarter three 2025, has worsened”.
It continued:
“The market will need access to LNG producers’ uncontracted gas to mitigate the risk of shortfall”, and went on to conclude “the main causes of change in outlook are declines in gas production and LNG producers’ net contributions to the domestic market”.
Specifically, it said:
“A larger shortfall is expected for the southern states. The southern states are forecast to have a 40 PJ shortfall in quarter 3 2025, an increase in their projected deficit of 3 PJ”.
This deteriorating domestic gas crisis has been driven by Labor Party policy; and Labor Party philosophy.
What concerned the Coalition even more about the ACCC’s report, however, was that it almost challenged this government – dared it – to prepare to activate the ADGSM: the “gas trigger”, that grinds LNG exports to a halt, unless by exception.
“We recommend that the Government work with LNG producers to identify voluntary, industry-led solutions to avoid a shortfall”, last Thursday’s report said, “which may include securing up to 15 PJ of their uncontracted gas for domestic use”.
“Should initial voluntary solutions not be agreed”, it continued, “the Minister for Resources has the option of activating the ADGSM to limit or prohibit exports of LNG as a measure of last resort”.
Nobody wants a situation where the ADGSM would be activated.
But under Labor, that is becoming perilously close. Not because of the decisions of industry. But because of the failed policies of the government.
A Dutton-led Coalition Government will be tasked with urgently navigating Australia out of our national gas crisis.
And we will.
Labor’s national gas emergency, will be replaced with the Liberal and Nationals’ National Gas Plan.
We will unleash Australia’s abundant reserves of natural gas to bring prices down here at home; and to generate export revenue.
We will get Australia back on track by streamlining and halving approval times. To remove state and Commonwealth duplications we will accredit the states and territories to provide approvals which meet Commonwealth legislative requirements.
A Coalition government will do that.
We will get Australia back on track by fast-tracking a decision on Western Australia’s North West Shelf project within 30 days of forming government; and we will instigate an immediate audit of ‘development ready’ gas projects with a priority focus on the southern States, to pinpoint delays and causes.
A Coalition government will do that.
We will get Australia back on track by including gas in the Capacity Investment Scheme; and by developing Australia’s untapped gas resources by reinstating annual acreage releases for offshore oil and gas exploration.
We will reinstate a $300 million Strategic Basin Plan; and we will invest $1 billion into a Critical Gas Infrastructure Fund to increase gas pipeline and storage capacity – it’s about getting molecules to market.
To be clear: that is Government investment in the gas sector under a Coalition Government.
We will deliver the targeted investment our gas industry needs to secure new supply, avert shortfalls, and bring down power prices.
This investment will also be supported with the reinstatement of the National Gas Infrastructure Plan – axed by Labor – to ensure there is long term national planning for gas infrastructure, including storage facilities in the southern states, to ensure we can match gas supply and demand.
To get Australia back on track we will stop government funded lawfare: we have already given a commitment to defund the radical and discredited Environmental Defenders Office by stripping it of $8.3 million in Labor-endorsed taxpayer handouts.
This group, we must remember, was compelled by the Federal Court to make a $9 million settlement after it was found to have confected and constructed Indigenous cultural heritage.
To get Australia back on track, we will have a fit for purpose ADGSM that cements as a core principle the flexibility for the Minister for Resources to consider industry-led options to guarantee lower prices and avoid domestic gas shortages.
And I can announce today that to boost investment, a Coalition Government will elevate gas to the same status as a critical mineral: this will ensure gas projects are able to apply for funding from the $4 billion Critical Minerals Facility.
This will ensure gas projects – so critical to our national and international security – are able to access specialised teams within the Department of Resources to support their projects.
This will ensure that gas remains a critical part of the Australian economy for decades to come.
Contrast that with Labor’s decision to partner with the Greens to legislate to block the gas sector accessing support from the so-called Future Made in Australia program.
These reforms demonstrate and confirm that a Coalition government will do the heavy-lifting – and the heavy investment – to empower our gas sector to drive-down energy prices; and drive-up export revenue.
After three years of Labor Government policy failure, we know a Dutton-led Coalition Government has to do more to support industry and the households, businesses and trading partners that rely on a flourishing gas sector.
But it comes as no surprise that we will also ask industry to do more: and it should come as no surprise that Australians expect more: from government and industry. I can’t emphasise to this room enough, just how much Australians expect a redoubling of efforts to secure affordable domestic gas.
A Coalition Government will need the support and further heavy-lifting from the gas industry, if we are to rectify Labor’s failed policy settings.
We will implement ‘use it or lose it’ stipulations so offshore gas fields are not locked up for years.
Australia wants the gas; Australia needs the gas.
That’s why the Coalition’s National Gas Plan will ensure there is Australian gas working for Australians.
It’s why Peter Dutton announced in his Budget Reply that a Coalition Government will introduce an east coast gas reservation.
As outlined, this policy will ensure a proportion of exports – between 50-100 petajoules of spot cargo in its first full year of operation – is diverted to the domestic market.
This will secure an additional 10 to 20 per cent of current east coast demand.
Our plan does not impact on foundation contracts. A key component of this plan is the preservation of foundation contracts.
It does not impose a ban on the export of uncontracted gas. And, as its name suggests, it does not apply to Western Australia.
What it does do: is ensure there is enough Australian gas for Australia to not only plug projected shortfalls, but to also help push down energy prices.
That is not a goal of government; it is a duty of government.
By ensuring this additional gas remains in Australia, domestic gas prices will be decoupled from volatile, expensive international markets.
This additional supply along with the other initiatives I have outlined from our National Gas Plan, will reduce prices at Wallumbilla for new gas sales to $10 per gigajoule, compared to around $14 at the moment.
Our reservation policy will ensure Australians have access to Australian gas; while honouring the long term foundation contracts for export with our trade partners at all times.
We will work with the gas industry and will implement these changes swiftly.
And we will work to ensure the mechanism design both delivers the additional gas Australians require while recognising the important contributions already made to the domestic market.
We expect to see relief by the end of the year.
Consistently since we sat down at our roundtable with industry in October , we have discussed the need for gas to be sold into the domestic market, not simply offered.
We have said that those offers need to be in packages that are digestible and timely for Australian manufacturers and users, to prevent jobs from being offshored as we are already seeing.
And finally not only are all east coast gas exporters part of ensuring they commit to supplying additional gas to the market, it is also the pipeline operators and retailers who are the means by which that supply is made available where gas is needed, when gas is needed, and at a price that grows Australia.
We are confident our policies will propel new investment in gas, to ensure ample new supplies for the domestic and international market into the future.
We are the seventh largest gas producer in the world. We can amply supply both markets.
Packaged together, the comprehensive, fully-costed measures in the Coalition’s National Gas Plan will safeguard energy security for Australians, unlock new supply, and create opportunities for smaller players to grow and access international markets while putting downward pressure on prices.
We have consistently said that a Coalition Government will fast-track approvals; give favourable access to acreage; and commit funding to infrastructure. In return we need more gas in the domestic market.
We are confident – we know – our policies will drive-up gas supply for Australia and Australia’s trading partners.
A Dutton-led Coalition Government will turbocharge our resources sector – and we see the future of gas as being instrumental to that.
ENDS