Central Petroleum CEO, Richard Cottee, has said that all Australian natural gas users should welcome the recent decision by the Council of Australian Governments (COAG) to support the quick development of a natural gas pipeline to link the northern and eastern gas markets.
Cottee explained: “Fundamentally, this pipeline is ‘the missing link’ that can provide real relief to gas shortages on the east coast while being a catalyst for badly overdue micro-economic reform of the domestic gas market. Joining the excess gas supply and enormous underexplored resources of the north to the eastern states that are severely short of gas is compelling on many levels.
“New sources of gas from multiple suppliers will contribute to the depth and liquidity of the domestic gas market and will inevitably lead to lower prices and more supply security for domestic gas users.
“A strong domestic spot market is the only way to generate transparent pricing and commercial incentives to drive greater gas supplies and lower gas prices for domestic consumers and industrial users.
“This is the micro-economic reform necessary for industrial jobs to be preserved and expanded, and for retail consumers to access lower cost natural gas at prices that are not competing with the export LNG market.
“Importantly, the hub will allow new gas projects to be developed by smaller operators requiring less capital and lower barriers to entry into the gas supply industry.”
Conventional gas from discoveries in Northern Territory over the last 30 years has produced a surfeit of supply, and only a pipeline was required to create the conditions for a national domestic gas market.
“The sooner the governments can approve the pipeline route, it can be built and gas consumers can get relief from the threat of rising gas prices.
“COAG’s endorsement of the NT Pipeline proposal to create a national domestic gas market will benefit natural gas consumers around Australia and it commendable that the Northern Territory Chief Minister Adam Giles has led this important micro-economic reform on behalf of the nation,” Cottee continued.
The Northern Territory will also benefit directly from gas royalties and the economic stimulus the NT Pipeline will bring to Alice Springs by promoting exploration and project development.
Approximately 30% of Central’s employees are local indigenous people and the anticipated expansion will be a direct stimulus to local employment and skills training in Central Australia.
Adapted from press release by Katie Woodward
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/10102014/coag-pipeline-to-benefit-gas-users-1579/