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1、September 2024Gas Inquiry 2017-2030Interim update on east coast supply-demand outlook for quarter 1 of 2025Acknowledgement of country The ACCC acknowledges the traditional owners and custodians of Country throughout Australia and recognises their continuing connection to the land,sea and community.W

2、e pay our respects to them and their cultures;and to their Elders past,present and future.Australian Competition and Consumer Commission Land of the Ngunnawal people 23 Marcus Clarke Street,Canberra,Australian Capital Territory,2601 Commonwealth of Australia 2024 This work is copyright.In addition t

3、o any use permitted under the Copyright Act 1968,all material contained within this work is provided under a Creative Commons Attribution 3.0 Australia licence,with the exception of:the Commonwealth Coat of Armsthe ACCC and AER logos any illustration,diagram,photograph or graphic over which the Aust

4、ralian Competition and Consumer Commission doesnot hold copyright,but which may be part of or contained within this publication.The details of the relevant licence conditions are available on the Creative Commons website,as is the full legal code for the CC BY 3.0 AU licence.Requests and inquiries c

5、oncerning reproduction and rights should be addressed to the Director,Content and Digital Services,ACCC,GPO Box 3131,Canberra ACT 2601.Important notice The information in this publication is for general guidance only.It does not constitute legal or other professional advice,and should not be relied

6、on as a statement of the law in any jurisdiction.Because it is intended only as a general guide,it may contain generalisations.You should obtain professional advice if you have any specific concern.The ACCC has made every reasonable effort to provide current and accurate information,but it does not

7、make any guarantees regarding the accuracy,currency or completeness of that information.Parties who wish to re-publish or otherwise use the information in this publication must check this information for currency and accuracy prior to publication.This should be done prior to each publication edition

8、,as ACCC guidance and relevant transitional legislation frequently change.Any queries parties have should be addressed to the Director,Content and Digital Services,ACCC,GPO Box 3131,Canberra ACT 2601.ACCC September 2024 www.accc.gov.au Contents Outlook for Quarter 1 2025 Key Points.1 Overview.2 Decr

9、ease in projected surplus.2 A material surplus is required ahead of winter 2025.2 Measures to reduce continuing short-term risks of gas shortfalls.3 East coast supply-demand outlook for quarter 1 2025.4 Seasonal aspect of east coast supply and demand.4 Reduced surplus projected for quarter 1 2025.5

10、Influence of LNG producers on the market outlook.6 Re-shaping of export cargoes and gas swap arrangements.6 The effect of LNG producers decisions on available gas.7 Key market risks.8 Low Storage levels at Iona Underground Gas Facility.9 GPG demand variations.10 Southern states gas production.11 Nor

11、thern Territory supply.12 Southern states expect surplus gas whereas Queensland will have a shortfall.13 Opportunities to mitigate market risks.15 LNG producers may need to commit additional uncontracted gas to the domestic east coast market.15 Measures to reduce continuing short-term risks of gas s

12、hortfalls.15 Appendix A:LNG producers outlook.17 Appendix B:Actuals compared to forecast for quarter 1 2024.18 Outlook for Quarter 1 2025 Key Points Lower surplus projected for Quarter 1 2025 This report provides information on whether there is expected to be sufficient gas to meet demand on the eas

13、t coast of Australia in quarter 1 2025.The latest information suggests there will be surplus gas of between 12 PJ and 27 PJ across the east coast,depending on the volume of uncontracted gas exported.This surplus is less than our last forecast in June 2024 of a surplus between 26 and 35 PJ.A minimum

14、surplus of 12 PJ(if the LNG producers export all of their uncontracted gas)will be important for the east coast market to help re-fill storage facilities ahead of winter and provide a buffer for other market risks.Given uncertain demand for gas powered generation(GPG)and the risk of disruptions to p

15、roduction,the LNG producers may need to commit more gas to the east coast market in quarter 1 2025 to mitigate the risks of a shortfall.Iona Gas Storage Facility needs refilling ahead of winter 2025 Iona reached critically low levels during August 2024 following a heavy drawdown of gas from storage

16、to meet southern states 2024 winter demand.A net addition of up to 15 PJ of gas is required by May 2025 to maximise Iona storage levels ahead of next winter.Increased levels of LNG exports expected for Quarter 1 2025 The LNG producers have reported a 20 PJ increase to their contracted export volumes

17、.This is partly due to changes in anticipated seasonal gas swaps,with producers now forecasting purchase of more gas from the domestic market in the summer quarters to meet re-shaped contracted exports.This will be balanced by the supply of additional gas into the domestic market during winter quart

18、ers.488 PJ of forecast gas supply The most recent forecast for quarter 1 2025 supply is 11 PJ higher than the last forecast in our June 2024 report.Surplus expected for southern states The southern states are expected to have a 14 PJ supply surplus.If all uncontracted LNG gas is exported,Queensland

19、is expected to need an additional 2 PJ of gas to meet domestic demand.2 Overview This is the September 2024 interim report of the Australian Competition and Consumer Commissions(ACCC)inquiry into gas supply in Australia(the Inquiry).The information in this report is intended to increase transparency

20、 on gas supply and demand,in particular to provide an updated supply-demand outlook for quarter 1 2025.The information may be relevant and used to inform decision-making by the Minister for Resources under the Australian Domestic Gas Security Mechanism(ADGSM).Decrease in projected surplus There is a

21、nticipated to be between a 12 and 27 Petajoule(PJ)surplus of gas across the east coast market in quarter 1 2025,based on the latest information.The size of the surplus will depend on how much of the Queensland Liquified Natural Gas(LNG)producers uncontracted gas is exported.The projection of a 12 to

22、 27 PJ surplus is significantly less than our last forecast in June 2024 of a surplus between 26 and 35 PJ.The change primarily reflects the re-shaping of contracted export volumes by LNG producers.The capacity to re-shape contracted export volumes provides a means of meeting variations in demand bo

23、th domestically and overseas.The LNG producers may,as is projected for 2025,increase export cargoes during periods of lower Australian demand for gas,namely in our summer months,to meet higher overseas winter demand.In turn,the LNG producers are expected to make more supply available to the domestic

24、 market over our winter months,when domestic demand for gas peaks.The LNG producers have increasingly entered into gas swap arrangements with other east coast gas participants to support the matching of supply and demand.The re-shaping of exports has played an important role in averting domestic gas

25、 shortfalls during peak periods in recent years.As the extent of re-shaping undertaken by the LNG producers affects the amount of gas available to the domestic market in any given quarter,it is important that there are also means to ensure that the domestic market has sufficient overall supply to me

26、et demand.A material surplus is required ahead of winter 2025 Surplus gas in quarter 1 2025 is needed to help re-fill southern gas storage facilities in preparation for the Australian winter,and to mitigate against unexpected increases in demand for GPG and/or disruptions to supply in the southern s

27、tates.The estimated minimum surplus of 12 PJ(if the LNG producers export all of their uncontracted gas)will be important for the east coast market to help re-fill storage facilities and provide a buffer for other market risks.Given uncertain demand for GPG and the risk of disruptions to southern sta

28、tes production,the LNG producers may need to commit more gas to the east coast market in quarter 1 2025 to mitigate the risk of shortfalls.The LNG producers are estimated to have 15 PJ of uncontracted gas available.As part of the Heads of Agreement requirements,the LNG producers are obliged to offer

29、 uncontracted gas that could be sold as spot or additional LNG cargoes to the Australian domestic market 3 first,before offering it to the international market.1 Uncontracted gas could be made available to the east coast market by:selling this gas directly to the market,including through the exercis

30、e of flexibilityarrangements in existing contracts with domestic customersselling to other market participants supplying the domestic market,including aspart of swap arrangements.The LNG producers actual exports for quarter 1 2025,and hence the actual volumes of uncontracted gas available,will likel

31、y be finalised by the producers shortly.The amount of uncontracted gas that the LNG producers commit to the domestic market for the quarter should be based on updated market data,including on storage levels.Measures to reduce continuing short-term risks of gas shortfalls The LNG producers have compl

32、emented the east coast markets seasonal variations in demand and supply through re-shaping their export cargoes.They have made additional gas available to the domestic market at peak demand periods.Given declining production from the southern states and the increasing underlying risk of gas shortfal

33、ls in the east coast market,access to the LNG producers uncontracted gas is becoming more important throughout the year.The LNG producers decisions on the timing of exports can have a material impact on the volumes of gas available to the east coast market at any time.In addition to seasonal shaping

34、 of export cargoes,the quantity of uncontracted gas available may change due to the exercise of flexibility provisions in export contracts,confirmation of LNG cargo delivery schedules and unexpected LNG plant maintenance.To better manage ongoing inter-seasonal and near-term supply risks,the LNG prod

35、ucers would,ideally,have regard to the east coast market outlook in making their decisions on export cargoes.For example,the following steps would contribute to the reliability of export forecasts and increase policy certainty in relation to the sufficiency of available gas:LNG producers having rega

36、rd to the east coast gas market outlook prior to increasingexport volumes and re-shaping export cargoes.LNG producers confirming changes in export cargo schedules sufficiently in advanceand not making material variations to these schedules without first considering theimpact on the domestic market o

37、utlook.These measures would help to manage risks in the shorter term but would not address and,rather,highlight the underlying problems of insufficient gas supply for the domestic market and the importance of longer-term measures to support more efficient and secure arrangements for supply.2 1Depart

38、ment of Energy,Science and Resources,Heads of Agreement,Australian Government,accessed 30 August 2024.2ACCC,Gas Inquiry 20172030,December 2023,p 40;June 2024,p 33.4 East coast supply-demand outlook for quarter 1 2025 This report provides information on whether there is expected to be sufficient gas

39、supply to meet demand across the east coast in quarter 1 2025(January,February and March).3 The supply-demand outlook is based on:total forecast supply of gas on the east coast,including net withdrawals from storage facilities total forecast demand,including domestic demand and the quantities of gas

40、 required by the Queensland LNG producers to meet their long-term LNG Sale and Purchase Agreement(SPA)commitments and LNG spot sales.Forecasts are based on the information provided to us by producers in response to our compulsory information gathering powers and AEMOs domestic demand forecast.Season

41、al aspect of east coast supply and demand The east coast gas market has been experiencing seasonal and locational variations in demand and supply.The key aspects of these variations are that:domestic demand from residential,commercial and industrial consumers is seasonal,with demand peaking in winte

42、r months in the southern states(across quarters 2 and 3)peak demand for GPG is more uncertain and heavily dependent on the electricity market.Until recently,gas for GPG has peaked in summer.It is now tending to peak in winter when it is required to firm up potentially lower or more intermittent rene

43、wable energy outputs4 declining gas production in the southern states means that stored gas,and gas delivered from Queensland,are playing an increasingly important role in meeting winter peak demand in the southern states.Gas storage facilities are typically drawn down over winter and filled between

44、 September and May when there is excess production exports of LNG,which comprise the largest source of demand for east coast gas supply,are seasonal.While the Queensland producers export LNG regularly throughout the year,they tend to export more LNG cargoes during the warmer Australian months when i

45、nternational LNG demand is greater.The LNG producers have increasingly entered into gas swap arrangements that allow them to increase supply available for exports during the warmer months and return this gas to the domestic market during winter.In this context,supply and demand in quarter 1 is impor

46、tant as it needs to balance higher volumes of LNG export commitments with seasonal domestic demand requirements,including the need to replenish gas storage stocks ahead of the next Australian winter quarters.3 This outlook is an update to the forecast contained in our June 2024 report(see ACCC,Gas I

47、nquiry 20172030 Interim Report,June 2024).This latest report is based on data obtained from east coast gas producers and AEMO.Our approach to calculating the outlook is consistent with previous interim reports.4 AEMO,Gas Statement of Opportunities 2024,March 2024,p 35.5 Reduced surplus projected for

48、 quarter 1 2025 The latest information indicates a surplus for the east coast gas market of between 12 PJ and 27 PJ gas surplus(Chart 1).The size of the surplus will depend on the LNG producers exporting decisions,including how much of their uncontracted gas will be exported as LNG spot cargoes and

49、additional sales.The surplus will be 12 PJ if LNG producers export all their estimated uncontracted gas and 27 PJ if the LNG producers only export currently anticipated LNG spot or additional sales.Chart 1:East coast supply-demand outlook in quarter 1 2025(PJ)Source:ACCC analysis of data obtained fr

50、om gas producers in July 2024 and of the domestic demand forecast(Step Change scenario)from AEMO,Gas Statement of Opportunities(GSOO),March 2024.Note:Totals may not sum due to rounding.The quantity required to meet long-term LNG SPAs includes feed gas requirements(such as fuel)required to produce LN

51、G.The latest projection of a 12 to 27 PJ surplus for quarter 1 2025 is significantly less than our last forecast in June 2024 of a surplus between 26 and 35 PJ.5 The outlook has changed primarily due to a 20 PJ increase in contracted exports under LNG SPAs for the quarter.The increase in contracted

52、exports is primarily due to a shift in the timing of export cargoes between the domestic peak and off-peak demand periods.This shift has been supported by seasonal gas swap arrangements with domestic market participants,which will involve the LNG producers supplying gas volumes back to the domestic

53、market during the domestic peak demand periods.5 ACCC,Gas Inquiry 20172030,June 2024,p 22.488 83 12 359 8 15 488 477 -100 200 300 400 500SupplyDemandQuantity(PJ)LNG producers netuncontracted gasLNG producers anticipatedspot salesQuantity required to meetlong term LNG SPAsDomestic demand(GPG)Domestic

54、 demand(Residential,commercial,industrial)Supply(Production from 2Preserves,net storagewithdrawals)6 The projected changes in export demand are offset by an increase in forecast production in Queensland(primarily from the LNG producers).This higher production has contributed to higher volumes of unc

55、ontracted gas being available(Chart 2),as discussed further in the next section below.Chart 2:Reasons for change in quarter 1 2025 east coast supply-demand outlook Source:ACCC analysis of data obtained from gas producers in January 2024 and July 2024 and of the domestic demand forecast(Step Change s

56、cenario)from AEMO,Gas Statement of Opportunities(GSOO),March 2024.Note:Totals may not sum due to rounding.Influence of LNG producers on the market outlook The Queensland LNG producers(APLNG,GLNG and QGC)sell gas to international LNG buyers but are also a major source of supply and demand in the east

57、 coast market.In conditions of tight supply,as at present,the outlook for the east coast market is heavily influenced by the LNG producers decisions on export cargo volumes and the amount of gas therefore made available to,or bought from,the domestic market.Re-shaping of export cargoes and gas swap

58、arrangements The LNG producers are forecasting higher volumes of LNG exports 20 PJs of contracted exports under LNG SPAs and an additional 6 PJ if the LNG producers export their uncontracted gas as LNG spot cargoes and additional sales(Chart 3).As noted,the increase in contracted exports in this upc

59、oming quarter is primarily due to a shift in the timing of export cargoes between the domestic peak and off-peak demand periods.One of the LNG producers,in particular,has re-shaped their annual export profile by increasing their exports in quarters 1 and 4 of 2025 and reducing their exports in quart

60、ers 2 and 3 of 2025.Under seasonal gas swap arrangements with domestic market participants,the LNG producer is expected to supply gas back to the domestic market during the domestic peak demand period in quarters 2 and 3 of 2025.Seasonal gas swaps by LNG producers played an important role in avertin

61、g gas shortfalls in peak demand periods in winter 2023 and 2024 and is expected to continue to do so in 2025.We anticipate that the LNG producer may also need to purchase additional gas from the domestic market in quarters 1 and 4 of 2025 to meet their re-shaped export commitments.While we expect th

62、is will be returned to the domestic market during high demand periods,it will likely put downward pressure on the surplus available in quarter 1.7 Each of the LNG producers different decisions on production,exports and contracting with the domestic market affect the domestic outlook.Chart 3:Change i

63、n LNG producers outlook in quarter 1 2025 Source:ACCC analysis of data obtained from gas producers in January 2024 and July 2024.Note:Totals may not sum due to rounding.The effect of LNG producers decisions on available gas The LNG producers decisions on the timing of exports can have a material eff

64、ect on the volumes of gas available to the east coast market throughout the year.In this instance,their decisions on re-shaping have reduced the amount of surplus gas available in quarter 1 2025.In addition to seasonal shaping of export cargoes,the quantity of uncontracted gas available may change d

65、ue to the exercise of flexibility provisions in export contracts,confirmation of LNG cargo delivery schedules,and unexpected LNG plant maintenance.All of these factors have contributed to changes in forecast export volumes by the LNG producers in the past,in some quarters increasing reported volumes

66、 and in other quarters reducing volumes.6 We observe that the LNG producers are expecting to purchase more gas from the domestic market for export purposes in quarter 1 than they are expecting to sell back to the market in this quarter in 2025,as was the case for the first quarters of 2023 and 2024(

67、Chart 4).These gas purchases from the domestic market are made through both gas swap arrangements and direct engagement with domestic market participants.Net negative contributions to the domestic market are not problematic in themselves,but do highlight the markets exposure to LNG producers exporti

68、ng decisions,particularly in circumstances of other significant risks to supply,as we have identified in this report.6 ACCC,Gas Inquiry 20172030,September 2023,March 2024,June 2024.8 Chart 4:LNG producers net market contribution for quarter 1,2023 2025 Source:ACCC analysis of data obtained from gas

69、producers in January 2022,June 2023 and July 2024.Note:The net market contribution and net excess gas in 2023 does not include gas swaps between LNG producers and domestic market participants.Net excess gas is the combined total of excess gas available from all LNG producers.This gas does not includ

70、e anticipated spot sales.Key market risks Market risks and trends suggest that a material gas supply surplus will be required in quarter 1,2025:Gas storage in the southern states fell below 10 PJ in mid-August due to higher than usual gas withdrawals from storage during winter 2024.The Iona storage

71、facility will require up to 15 PJ of gas injected before May 2025 to reach storage capacity levels comparable to previous years,which is necessary to secure southern states energy security in winter 2025.The forecasts for demand for GPG during quarter 1 have trended downwards in recent years.However

72、,there is higher reliance on GPG to provide firming support for renewable energy and to provide power in the event of coal generation outages.These events were experienced,for example,in February 2024.Production in southern states will be affected by scheduled maintenance at the Longford processing

73、facility.7 Although Longford is expected to return to normal capacity by the end of quarter 1 2025,there remains a risk of delayed completion of maintenance activities,which would disrupt southern state supply for a longer period.There remains uncertainty in relation to supply in the Northern Territ

74、ory.The Northern Gas Pipeline is currently being upgraded to allow bidirectional flow between the Territory and Queensland.8 While the Northern Territory Government is taking measures to 7 Australian Energy Market Operators,Medium Term Capacity Outlook(Future),accessed 30 August 2024.8 AEMO,Gas Bull

75、etin Board,Reserves resources reporting and facility developments,Facility development projects,accessed 23 August 2024.-328-15.318.5-27.114.9-30-20-100102030Net Market ContributionNet Uncontracted GasQuantity(PJ)202320242025 9 improve gas supply for the longer-term,it remains possible that the Nort

76、hern Territory will seek some gas from the east coast market in quarter 1 2025.9,10 Overall,market conditions suggest that a material surplus is necessary to help replenish the Iona storage facility over quarter 4 2024 and quarter 1 2025 and to provide a buffer in the event of unexpected demand for

77、gas and/or disruptions to southern gas production.Low Storage levels at Iona Underground Gas Facility Gas storage facilities help to ensure supply adequacy and manage changes in peak-day and seasonal demand.The Iona gas storage facility plays an important role in southern states over the winter mont

78、hs.Iona is typically replenished with surplus gas between August/September and May before being drawn down over winter.During the 2024 winter,gas stored at Iona was crucial in meeting southern winter demand following a spike in GPG demand and lower than anticipated production from the Gippsland Basi

79、n.11 Stores were drawn down by 14 PJ between May and August 2024,approximately 56%of total capacity,marking it as the heaviest withdrawal in four years for this time of the year(Chart 5).12 Gas levels at Iona fell below 10 PJ by mid-August,which is 2 PJ above its minimum operational level of 8 PJ.Op

80、erational efficiency requires gas in storage to remain above this threshold as it provides the pressure required to withdraw gas at optimal rates.Chart 5:Year-on-year Iona underground storage levels Source:AEMO,Gas Bulletin Board Gas flows and capacity outlooks as at 29 August 2024.The level of gas

81、at Iona started to improve through August and is increasing in line with the trends in 2021 and 2022.In these years,there was a similarly large draw down on storage 9 Chief Minister of Northern Territory,NT Gov gas supply deal with Mereenie,Media Release,accessed 30 August 2024.10 Empire Energy Grou

82、p,Empire Energy signs a 10-year deal,Sale Agreement,Empire Energy,accessed 30 August 2024.11 On 19 June 2024 AEMO identified a potential risk to the east coast gas market when Ionas storage levels were dropping quickly and posed a risk to gas supply adequacy in the southern states.See AEMO,East Coas

83、t Gas System Risk or Threat Notice,19 June 2024.12 Gas storage levels were significantly higher in 2023,following a milder than usual winter that led to lower seasonal demand and helped retain the higher than usual storage volumes.However,current storage volumes are similar to the levels post-winter

84、 2022,following which the east coast gas market experienced a shortfall in supply(see discussion in ACCC,Gas Inquiry 20172030,June 2023,Appendix A).051015202530JanFebMarAprMayJunJulAugSepOctNovDecStorage Volume(PJ)2020202120222023202410 during winter,which was refilled during quarters 1 and 4(Chart

85、6).Following these past trends,Iona will require up to 15 PJ of gas to be reinjected by May 2025 to maximise storage levels ahead of winter.Chart 6:Quarterly gas flow for Iona storage(2019 2024)Source:AEMO,Gas Bulletin Board Gas flows and capacity outlooks as at 16 August 2024.GPG demand variations

86、GPG demand is sensitive to several factors,including weather events,unplanned maintenance,outages in the NEM,and the progress of renewable generation and battery integration in the electricity network.The variability of demand for gas for power generation poses a risk to the supply-demand outlook.Th

87、e forecasts for gas demand for GPG during quarter 1 have trended downwards in recent years(Chart 7).This change is likely due to the greater integration of renewable power generation sources in the NEM,which shifts demand for GPG more to the winter months,when energy demand is higher(for example,for

88、 heating)and renewable energy output is lower and more intermittent.13 13AEMO,Gas Statement of Opportunities 2024,March 2024,p 39.-12.00-8.00-4.000.004.008.0012.001234123412341234123412201920202021202220232024Quantity(PJ)InjectingWithdrawing 11 Chart 7:Gas power generation consumption forecast for q

89、uarter 1(2023 2025)Source:ACCC analysis of data obtained from AEMO,Gas Statement of Opportunities,March 2024.Demand for GPG is expected to be relatively low in the southern states for Quarter 1 2025.14 However,there remain risks of unexpected demand for GPG from unplanned reductions in renewable ene

90、rgy output or disruptions to the remaining coal generation plants.This situation occurred in February 2024,when Victorian weather conditions saw significant outages of coal power stations and transmission lines on the states electricity system.The coal plant outages led to increased use of GPG in Vi

91、ctoria.Southern states gas production The Longford production facility has scheduled offshore and onshore maintenance in January and February 2025(Chart 8).Although production is expected to reach normal volumes following each maintenance cycle,there is still a risk of delay in completion of mainten

92、ance activities,which would affect supply to the market.The impact of unexpected delays in maintenance activities on supply security was observed during winter 2024,when AEMO issued a threat notice identifying potential risks to supply adequacy across the east coast gas system.15 At this time,the Lo

93、ngford facility experienced prolonged,unplanned maintenance activities.The effect of disruptions to supply was compounded by higher than usual seasonal gas demand for GPG,leading to a high risk of supply shortfall for the southern states during the winter months.14 GPG demand is expected to decrease

94、 in 2025 due to the announced delay in the closure of the Eraring power plant,however this change will be observed from Q3 2025.AEMO,Gas Statement of Opportunities 2024,accessed 31 May 2024,p 38.NSW Government,NSW Government secures two-year extension to Eraring Power Station,accessed 30 July 2024.1

95、5 Australian Energy Market Operators,East Coast Gas System Risk or Threat Notice,issued on 19 June 2024.04812162024283236202320242025GPG demand(PJ)Forecast 12 Chart 8:Change in production capacity of Longford power plant in Quarter 1 2025 Source:ACCC analysis of data obtained from AEMOs Gas Bulletin

96、 Board.Northern Territory supply The Northern Territory gas market continues to face supply problems,as the output from the ENIs Blacktip gas fields fall short of demand following well intervention works.16 The Northern Gas Pipeline is currently being upgraded to allow for bi-directional flows,allow

97、ing for gas to flow from Queensland to the Northern Territory in situations where there is unmet local gas demand.The upgrade is expected to be completed by the end of 2024.17 While this presents another risk to the east coast supply demand balance,the Northern Territory has large gas reserves which

98、 are expected to begin producing gas.For example,the NT government recently signed:a 6-year supply agreement with Central Petroleum for up to 29 TJ/day from the Mereenie gas fields,commencing in quarter 1 2025 18 a 10-year supply agreement with Empire Energy or up to 25 TJ/day from the Beetaloo basi

99、n with volumes expected to commence in second half of 2025.19 16 AEMO,Gas Statement of Opportunities 2024,March 2024,p 12.17 Australian Energy Market Operators,Medium Term Capacity Outlook(Future),accessed 30 August 2024.18 Chief Minister of Northern Territory,NT Gov gas supply deal with Mereenie,Me

100、dia Release,accessed 30 August 2024.19 Empire Energy Group,Empire Energy signs a 10-year deal with NT gov,Sale Agreement,Empire Energy,accessed 30 August 2024.0100200300400500600700800Daily Maximum Firm Capacity(TJ)Maxium Plant CapacityOutlook QuantityOffshore MaintenanceOnshore Maintenance 13 South

101、ern states expect surplus gas whereas Queensland will have a shortfall The southern states are expected to have 14 PJ of surplus gas in quarter 1 2025(Chart 9).The latest outlook reflects a reduced surplus compared to the 17 PJ surplus reported in the ACCCs June 2024 report,primarily due to reductio

102、ns in forecast production.20 Queensland is projected to have a gas shortfall of 2 PJ of gas if LNG producers export all of their uncontracted gas.However,a surplus of 13 PJ is possible where only anticipated spot sales are exported.This is due to substantial increases(20 PJ)in expected LNG export vo

103、lumes for quarter 1 2025 to accommodate gas swap arrangements.This change has heavily offset the increase in production reported by the LNG producers,and higher gas supply to the domestic market through other gas swaps.Surplus gas in the southern states is typically used to replenish storage facilit

104、ies in preparation for high-demand winter months or transported to Queensland to meet domestic demand.However,as outlined above,there is a need for enough surplus gas across the east coast to fill up southern gas storage facilities and to provide a buffer for any seasonal demand variations experienc

105、ed across the east coast during the quarter.20 ACCC,Gas Inquiry 20172030,June 2024,p 26.14 Chart 9:Regional supply outlooks for quarter 1 2025(PJ)Source:ACCC analysis of data obtained from gas producers in July 2024 and of the domestic demand forecast(Step Change scenario)AEMO,GSOO,March 2024.410 26

106、 5 359 815 410 412 0100200300400500SupplyDemandQuantity(PJ)Queensland78 57 7 78 64 020406080100SupplyDemandQuantity(PJ)Southern States15 Opportunities to mitigate market risks LNG producers may need to commit additional uncontracted gas to the domestic east coast market The estimated minimum surplus

107、 of 12 PJ(if the LNG producers export all of their uncontracted gas)will be important for the east coast market to refill storage facilities ahead of winter and provide a buffer for other market risks.Given uncertain demand for GPG and the risk of disruptions to production,the LNG producers may need

108、 to commit more gas to the east coast market in quarter 1 2025 to mitigate the risks of a shortfall.There are currently limited options available to increase supply from other sources over this time period,with no new material supply sources expected to come online by quarter 1 2025,or to reduce dem

109、and in the domestic market.As part of the Heads of Agreement requirements,the LNG producers are obliged to offer uncontracted gas that could be sold as spot or additional LNG cargoes to the Australian domestic market first,before offering it to the international market.21 Uncontracted gas could be m

110、ade available to the east coast market by:selling this gas directly to the market,including through exercise of flexibilityarrangements in existing contracts with domestic customersselling to other market participants supplying the domestic market,including aspart of swap arrangements.Any additional

111、 supply should be offered to the east coast gas market in a way that meets the requirements of buyers.The estimate of 15 PJ of uncontracted gas is an aggregate amount across all the LNG producers and accurate as at the date of finalising this report.The amount that each individual producer may consi

112、der themselves to have available to offer to the domestic market varies,for example,due to customer flexibility provisions within existing contracts or buffers to account for contingencies.The LNG producers actual exports for quarter 1 2025,and hence the actual volumes of uncontracted gas available,

113、will likely be finalised by the producers shortly.The amount of uncontracted gas that the LNG producers commit to the domestic market should be based on updated market data,including on storage levels.Measures to reduce continuing short-term risks of gas shortfalls The LNG producers have complemente

114、d the east coast markets seasonal variations in demand and supply through re-shaping their export cargoes.They have made additional gas available to the domestic market at peak demand periods.Given declining production from the southern states and the increasing underlying risk of gas shortfalls in

115、the east coast market,access to the LNG producers uncontracted gas is becoming increasingly important throughout the year.21Department of Energy,Science and Resources,Heads of Agreement,Australian Government,accessed 30 August 2024.16 The LNG producers decisions on the timing of exports can have a m

116、aterial impact on the volumes of gas available to the east coast market at any time.In addition to seasonal shaping of export cargoes,the quantity of uncontracted gas available may change due to the exercise of flexibility provisions in export contracts,confirmation of LNG cargo delivery schedules a

117、nd unexpected LNG plant maintenance.To better manage ongoing inter-seasonal and near-term supply risks,the LNG producers would,ideally,have regard to the east coast market outlook in making their decisions on export cargoes.For example,the following steps would contribute to the reliability of expor

118、t forecasts and increase policy certainty in relation to the sufficiency of available gas:LNG producers having regard to the east coast gas market outlook prior to increasingexport volumes and re-shaping export cargoes.LNG producers confirming changes in export cargo schedules sufficiently in advanc

119、eand not making material variations to these schedules without first considering theimpact on the domestic market outlook.These measures would help to manage risks in the shorter term but would not address and,rather,highlight the underlying problems of insufficient gas supply for the domestic marke

120、t and the importance of longer-term measures to support more efficient and secure arrangements for supply.22 22ACCC,Gas Inquiry 20172030,December 2023,p 40;June 2024,p 33.OFFICIAL Appendix A:LNG producers outlook This section provides information on the east coast LNG producers supply and demand out

121、look,including gas that has not yet been committed.Table 1 shows the forecast aggregated supply-demand breakdown for the LNG producers in quarter 1 2025 and changes since our June 2024 report.23 Supply has increased by 23 PJ,while demand has increased by 20 PJ,however anticipated spot sales have rem

122、ained the same.Overall,there is an increase in the forecast uncontracted gas and net uncontracted gas for quarter 1 2025.Table 1:LNG producers forecast supply and contracted sales in quarter 1 2025(PJ)LNG forecast Quarter 1 2025 Change in Quarter 1 2025 forecast Supply Production from 2P reserves+ne

123、t storage withdrawals 355+15 3rd party purchases from suppliers other than LNG projects 53+2 LNG producers gas swap received 23+8 Total supply available to LNG producers 430 Demand Contracted east coast market demand 34 0 Quantity required to meet LNG SPAs 359+20 LNG producers gas swaps supplied 14-

124、1 Total contracted LNG demand 408 Uncontracted gas supply LNG producers uncontracted gas 22+6 LNG producers anticipated LNG spot and additional sales(out of their uncontracted gas)8 0 LNG producers net uncontracted gas 15+6 Source:ACCC analysis of data obtained from LNG producers in January 2024 and

125、 July 2024.Note:Totals may not add up due to rounding.The quantity required to meet the contractual obligations under long-term SPAs include the feed gas required to produce LNG(such as fuel).23 Reflects information underlying the forecast for quarter 1 2025 in ACCC,Gas Inquiry 20172030,June 2024,p

126、26.18 Appendix B:Actuals compared to forecast for quarter 1 2024 Table 2 compares the supply demand outlook for quarter 1 2024,as published in the December 2023 interim report,24 with actuals over the same period,obtained from AEMOs Gas Bulletin Board(GBB).25 Table 2:Comparison of forecast vs actual

127、s for Quarter 1 2024 Quarter 1 2024 forecast Quarter 1 2024 actuals Quarter 1 2024 difference(actual-forecast)Quarter 1 2025 forecast Supply Supply total 478 473-5 488 Demand Quantity to meet LNG SPAs 340 369(total export)-4 359 LNG producers Uncontracted gas 33 NA NA 22 Net storage injections NA 2

128、NA Included in supply total above Queensland demand ex LNG 37 37 0 31 Southern states 74 66-8 64 Demand total 484 475-9 477 Outlook Surplus/shortfall-6-2*+4+12 Source:ACCC analysis of data obtained from producers in October 2023 and AEMO Gas Bulletin Board Actual flow and Storage(all data)as at 17 J

129、uly 2024.Notes:Totals may not sum due to rounding.*Actual supply and demand not balancing can be attributed to pipeline linepack,where gas compression can result in injected gas being greater than withdrawn gas.Actual supply and demand were both lower than expected,resulting in a closer supply deman

130、d balance.This was driven by:lower domestic demand in the southern states LNG producers not exporting all their forecast uncontracted gas.Quarter 1 generally exhibits the lower levels of domestic gas demand with minimal space heating loads,particularly with east coast temperatures and rainfall being

131、 around their usual levels.24 ACCC,Gas Inquiry 2017-2030 interim report,March 2023,p10.25 AEMO,Gas Bulletin Board,Actual flow and Storage(all data)as at 17 July 2024.19 Actual supply was lower than forecast from Victoria,and the Northern Territory.Declining and inconsistent production from legacy fields,delays to production from 2P undeveloped resources,planned and unplanned maintenance and business rationalisation decisions are the most likely contributing factors to the observed differences between actual and forecast supply.