A generational west coast gas shakeup looms
Saul KavonicThe APPEA Journal 61(2) 405-407 https://doi.org/10.1071/AJ20081
Accepted: 13 April 2021 Published: 2 July 2021
Abstract
From record high prices, a decade ago, to record low prices more recently, Australia’s west coast gas market is heading towards a structural shakeup that will challenge the status quo for producers, buyers and policymakers. The Western Australian (WA) gas market has been soft recently but is poorly understood, and prices may materially tighten this decade in wake of uncertain new supply timing, liquefied natural gas (LNG) producer recalcitrance towards domestic market, lack of new discoveries (outside Perth Basin), upward pressure on US gas pricing and government policy flexibility towards the emergence of LNG ullage. We believe a bifurcated WA gas market could emerge, whereby policy targets cheap gas to underpin new manufacturing, while existing gas buyers are left to compete against much higher LNG netback parity pricing.
Keywords: domestic gas, LNG, west coast, shakeup.
Saul Kavonnic is Director APAC Markets and the head of Australian energy research at Credit Suisse. He presents at leading industry conferences in the region and is a regular gas and energy commentator in print and broadcast media. Saul was previously head of oil, gas, LNG and energy in Australasia for Wood Mackenzie, the world’s leading oil and gas consultancy, and has delivered strategic consulting projects across the upstream, downstream, LNG and logistics sectors. He has also worked at Woodside Energy, Australia’s largest LNG company, at M.H. Carnegie & Co, one of Australia’s largest Venture Capital funds, and has advised on resource policy for the United Nations and African Union Commission. He is a member of the industry advisory board for the University of Western Australia Oceans Graduate School and a co-founder of Refugees Welcome Australia. Saul holds degrees in Law (Honours) and Chemical Engineering (Honours) from the University of Melbourne. |
