Winter gas shortfall looms for Victoria, state may have to rely on imports

Victoria is facing a gas shortfall this winter, despite a surplus of supply on the east coast over the next two years.

Victoria is facing a gas shortfall this winter, despite a surplus of supply on the east coast over the next two years.

The ACCC’s latest interim gas report warns that new gas production is not being brought on fast enough to offset southern states’ demand as local basins deplete.

The impending shortages mean gas will have to be supplied from Queensland and drawn from storage facilities.

But the report warns that as gas pipelines and storage reach capacity, southern states will have to rely on imports.

Victoria is facing a gas shortage over winter.

Gas imports into Victoria could occur as early as 2027. The reports states this could be a “cheaper temporary solution” compared to infrastructure upgrades, however, this will expose buyers to international price volatilities.

“Greater domestic supply would offset these effects but there continues to be insufficient investment in new gas supply and infrastructure,” the report states.

“We expect 77–112 petajoules (PJ) of excess production in the east coast over 2025 depending on LNG producers’ uncontracted gas exports.

“In southern states, however, we expect a shortfall of up to 16 PJ.”

The ACCC states that despite the projected surplus, prices agreed to for 2025 supply are around two times higher than they were for the 2021 supply year.

Resources Minister Madeleine King said secure, reliable, and affordable gas supply was vital for Australian households, businesses and the renewable energy transition.

“Since coming to office, the Albanese government has put an extra 600 PJ of gas into the east coast market to keep downward pressure on prices,” Ms King said.

Originally published as Winter gas shortfall looms for Victoria, state may have to rely on imports