Australia’s east coast is projected to face a significant natural gas supply deficit by 2027 unless new gas fields are developed and operational soon, according to a recent report by the Australian Competition & Consumer Commission (ACCC). This looming shortage poses a significant challenge to energy security and economic stability in the region.
The ACCC report highlights that Sydney and Melbourne, the capitals of the most populous states of New South Wales and Victoria, are already experiencing seasonal gas shortfalls during the winter months. This is primarily due to the depletion of older offshore gas fields, which have historically supplied a substantial portion of the region’s natural gas needs.
Traditionally, supply constraints in New South Wales and Victoria have been mitigated by piped gas from other states, notably Queensland. However, the increasing demand and declining production from existing fields have outpaced this capacity. The ACCC report suggests that importing liquefied natural gas (LNG) could offer greater flexibility and bolster the security of supply in the face of these challenges.
Despite being a global leader in LNG exports, ranking among the top three worldwide, Australia has paradoxically struggled to maintain sufficient domestic gas supply. This has led to government intervention, with revised regulations enabling authorities to restrict LNG exports to prioritize domestic needs. In a significant step towards addressing the supply issue, Australia’s first LNG import terminal, developed by Squadron Energy, a private venture owned by billionaire Andrew Forrest, was completed in New South Wales in December. 
Australia's first LNG import terminal aims to ease shortages.
The ACCC’s findings underscore the urgent need for new gas field development to avert the predicted shortfall. The development of new gas resources, coupled with strategic LNG imports, will be crucial in ensuring a stable and reliable energy supply for Australia’s east coast in the coming years. Failure to address this impending shortage could have far-reaching consequences for businesses, consumers, and the overall economy of the region.
