Value Collector
Have courage, and be kind.
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firstly in 30 years gas demand might be falling off a cliff or already dead.Queensland coal seam gas:
Total discovered technically recoverable gas = 66,955 PJ
LNG plant requirements over 30 years at full capacity = ~47,000 PJ.
Queensland domestic use over 30 years = 9400 PJ
All looks OK then?
Trouble is the detail with 25,300 PJ of that gas being uneconomic to extract according to the data provided to government. That cuts the total available to 41,665 PJ of which about 15,170 PJ has been extracted thus far with 26,495 PJ left to extract, presently being extracted at a rate of 1550 PJ per annum.
Those figures are all from Geoscience Australia (Government) ultimately sourced from the industry. Plus I've added in actual production since publication of those figures.
There's also the diversion of gas from Qld to other states via Moomba which adds to demand on Qld reserves. Doable at present but it relies on the "excess gas" being available in Queensland.
I'll leave others to add the numbers up there, based on whatever assumptions you choose, but suffice to say there's a reason for all the posturing going on. It's a game of musical chairs and nobody wants to lose.
A key issue there is timing and that shareholders and energy planners take a radically different view there. Shareholders and company boards might be thinking of their own investment horizon or their own tenure with that company and looking 5 or 10 years ahead. Energy planners and contract negotiators however are looking very much further ahead, in some cases through to the 2070's, and that explains the different perspectives. Nobody on that side is looking a year or two ahead, not when they're making 30+ year commitments to plant that requires gas to operate.
This chart sums up the overall position across all eastern states (including SA) including gas demand for export:
View attachment 170700
Source = ACCC
The "excess gas" referred to is simply that above the red line, above the contracted LNG exports. Noting that according to the LNG producers themselves, that uncontracted volume is negative from 2029 onwards. Or in simple terms supply falls short of demand. This doesn't change the physical need to send gas from Qld to Moomba to meet southern demand.
Putting the details aside, it's pretty straightforward and this is the bit of relevance to the thread. Australian buyers of gas, those wanting volumes that are above retail quantities (eg power generation, heavy industry) are finding it extremely difficult to do so. They issue a tender and these days it's pretty common to receive very few offers to supply at all, and none at an acceptable price. That's the issue of relevance to gas consuming businesses and the thread subject - the inability to obtain gas at a suitable price or even at all. All the rest, the reasons why, are really just background detail in that sense but it's price and availability, or the lack of it, that counts.
Those trying to contract gas beyond 2028, that is take volume away from the contracted exports, are finding it very hard to do so at all, and even harder to do it at an economical price. That's the crux of it. Even harder for those trying to get contracts running well into the future.
But, We have Beetaloo being connected to the grid soon too, and more will be discovered in Queensland, PNG is also possible in the future.
its a bit like how in 1995 my science text book said we had 30 years of oil left, now 29 years later we have 30 years of oil left.