Got Gas: Victoria’s stealthy gas project approval could be just the start
Hidden within a state government announcement on renewable energy projects was some big news about gas. And there is more of its ilk to come, says Bevis Yeo.
Stockhead
Don't miss out on the headlines from Stockhead. Followed categories will be added to My News.
Australia’s east coast is facing a looming gas shortfall crisis that will get increasingly worse from 2025 as declining supplies outpace expected declines in gas demand.
This has of course prompted calls for new sources to be developed, so it shouldn’t come as too much of a surprise that Victoria – Australia’s largest gas consumer – has gone out and done just that.
For the latest energy news, sign up here for free Stockhead daily newsletters
In a somewhat sneaky move, the state announced its approval of Beach Energy’s (ASX:BPT) plan to pipe gas from its Enterprise gas field in the offshore Otway Basin in the bowels of announcement on renewable energy projects.
The announcement waxed lyrical about projects such as the Mortlake South wind farm and the opening of the 102-megawatt Glenrowan Solar Farm then said that the state was transitioning to 95 per cent renewable energy generation by 2035, with the remaining 5 per cent to be gas peaking power.
It was at this point where the state government dropped its little bombshell that it had approved Beach’s plans to produce gas from the Enterprise field on the condition that it made best endeavours to sell to domestic customers first.
MORE FROM STOCKHEAD: Nuclear debate now trench warfare | Renewables prices a plus for green hydrogen | NT gas could ease eastern supply blues
No more was made of the topic, though Friends of the Earth were predictably quick to raise a hue and cry, slamming the state government’s decision to approve the production of gas from a field near the Twelve Apostles.
It noted that methane (the chief component of natural gas) is a much stronger greenhouse gas than carbon dioxide and that there was no excuse or need for another gas project in the country despite the gas industry’s claims to the contrary.
Expect more gas project approvals
While Victoria seems almost embarrassed to announce its decision to green light the Enterprise development, the fact remains that more such announcements will see the light of day as time goes by.
Regardless of what Friends of the Earth might think, the adoption of renewables and energy storage still isn’t progressing quite as quickly as is needed to replace fossil fuel use in time to meet growing demand.
Visit Stockhead, where ASX small caps are big deals
That means that for the near-term, it seems, new sources of gas would still be required in order to keep the lights on, keep homes warm and businesses running.
Not every project will get off the ground.
Some will simply fail the taste test for reasons such as high costs, high CO2 content, or technical challenges that are simply insurmountable.
However, there will be projects that will receive the green light just as Enterprise did and you can bet your bottom dollar that similar provisions regarding domestic gas sales will be written into their approvals.
This content first appeared on stockhead.com.au
SUBSCRIBE
Get the latest Stockhead news delivered free to your inbox. Click here
Originally published as Got Gas: Victoria’s stealthy gas project approval could be just the start
Investor Guide: Health & Biotech FY2025
In this special investor guide, health and biotech guru Tim Boreham leads Stockhead’s deep dive into the most cutting edge sector on the ASX.
Investor Guide: Gold & Copper FY2025
Stockhead's writers - including mining guru Barry FitzGerald - take you inside the copper and gold markets, and zero in on juniors exploring for the next major mine.