Implications of Western Australia’s updated domestic gas policy
Krishan Pal Birda A * , Kaushal Ramesh B and Sally Bogle AA
B
Krishan Pal Birda is a Senior Analyst who leads Rystad Energy’s Australasia Upstream Research & Analysis team. In addition to monitoring regional activity in Australasia and among E&P companies, he oversees the Australasia Solutions product. His other responsibilities include publishing frequent analyses, product development, and assisting clients on expert matters. Krishan specialises in the Australian gas & LNG markets as well as coal seam gas modelling. He has been employed with Rystad Energy for over 5 years and has a background in Civil Engineering. |
Kaushal Ramesh is Vice President of LNG and Head of Rystad Energy’s Gas and LNG Analytics and manages the company’s published LNG research, focussing on LNG trading, shipping, and investments. His past advisory work includes project economics, regulatory impact studies, market entry strategies and LNG contract negotiations. Prior to joining Rystad Energy, Kaushal worked in multiple roles at ExxonMobil, managing commercial operations of LNG and condensate cargoes from the Gorgon project, and gas and power sales contracts in the Asia-Pacific. He also advised on spot cargo trades and LNG contracting and investment decisions as a market analyst. |
Sally Bogle is Senior Editor of Analytics at Rystad Energy. She has a background in research, journalism, and copywriting for a range of public and private sector organisations including Accenture, FT Energy, S&P Global Platts, IHS Markit (CERA Global Insight), and the OECD’s International Energy Agency. She writes regularly on the Australasian upstream oil, gas and LNG export markets, the impact of new technologies (renewables, hydrogen, AI) and the climate risk policy and investment implications of fossil fuel use. |
Abstract
In August 2023, Western Australia (WA) updated its domestic gas reservation policy to restrict onshore gas exports through the existing pipeline network, primarily affecting the Perth Basin. While the policy update aimed to secure domestic gas supplies amid projected shortfalls, it may complicate the outlook for the WA gas market through restricted access to capital, reduced incentives for substantial investments in large-scale developments, and the elimination of a potential future gas demand source for the state. WA’s domestic gas consumption is expected to peak by the end of this decade and then steadily decline as part of the state’s net-zero emission ambitions. In contrast, the liquefied natural gas (LNG) market especially in Australia’s main buying partners in Asia is set to grow into the 2040s, offering lenders demand certainty. This paper assesses the potential implications of WA’s updated domestic gas policy. The state’s domestic gas market is projected to require 8–10 tcf of gas over 2023–50. Currently producing and under-development fields are expected to supply approximately 5 tcf during this period, leaving around a 2 tcf gap to be filled by the onshore resource base and potential new Domestic Market Obligations (DMOs). The paper reiterates the importance of gas in WA’s energy transition and the need to ensure future supply failing which prices could rise to LNG netback or trigger further intervention.
Keywords: balance, ban, basin, demand, DMO, domestic, exemption, export, gas, LNG, market, minerals, mining, onshore, Perth, policy, supply, WA, Western Australia.
Krishan Pal Birda is a Senior Analyst who leads Rystad Energy’s Australasia Upstream Research & Analysis team. In addition to monitoring regional activity in Australasia and among E&P companies, he oversees the Australasia Solutions product. His other responsibilities include publishing frequent analyses, product development, and assisting clients on expert matters. Krishan specialises in the Australian gas & LNG markets as well as coal seam gas modelling. He has been employed with Rystad Energy for over 5 years and has a background in Civil Engineering. |
Kaushal Ramesh is Vice President of LNG and Head of Rystad Energy’s Gas and LNG Analytics and manages the company’s published LNG research, focussing on LNG trading, shipping, and investments. His past advisory work includes project economics, regulatory impact studies, market entry strategies and LNG contract negotiations. Prior to joining Rystad Energy, Kaushal worked in multiple roles at ExxonMobil, managing commercial operations of LNG and condensate cargoes from the Gorgon project, and gas and power sales contracts in the Asia-Pacific. He also advised on spot cargo trades and LNG contracting and investment decisions as a market analyst. |
Sally Bogle is Senior Editor of Analytics at Rystad Energy. She has a background in research, journalism, and copywriting for a range of public and private sector organisations including Accenture, FT Energy, S&P Global Platts, IHS Markit (CERA Global Insight), and the OECD’s International Energy Agency. She writes regularly on the Australasian upstream oil, gas and LNG export markets, the impact of new technologies (renewables, hydrogen, AI) and the climate risk policy and investment implications of fossil fuel use. |
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