After 15 years of being lied to and cheated on the government is moving to tackle the Gas Cartel and is toying with the idea of a domestic gas reservation policy. What’s the scam?
Don’t hold your breath but the AFR ($) has reported Energy Minister Madeleine King putting the industry on notice for a “review would include the role of market bodies to ensure more gas is made available for Australians”.
MWM has been calling for gas reservation for ten years. The problem is that 84% of gas is exported and, as energy analyst Tim Buckley puts it, “Ridiculously high domestic methane prices also massively drives the Australian energy cost of living crisis, both directly into homes and indirectly by driving up wholesale electricity prices. Gas electricity generators have charged an average A$200/MWh in 1HCY2025, double the $97/MWh NEM average to-date”.
Buckley reckons the government could cut wholesale prices in half and still leave a tidy profit for the Cartel by simply making LNG export licences “conditional upon the supply of 16% of our public gas to the domestic market at an acceptable price – say a 50% premium to the Henry Hub domestic US price”. Ergo $7.50 for Australian consumers.
“Energy Minister Chris Bowen has tried to play nicely with this foreign cartel, but his $12 cap is entirely being ignored.”
In the meantime, the cartel and its media proxies will wail “sovereign risk” and bribe everybody with donations and dinners so there is a long road ahead and we will hear, as usual, about black-outs and a supply cliff and the urgent need for more drilling.
Michael West established Michael West Media in 2016 to focus on journalism of high public interest, particularly the rising power of corporations over democracy. West was formerly a journalist and editor with Fairfax newspapers, a columnist for News Corp and even, once, a stockbroker.