How to buy gas from Australia’s biggest gas producer

The first of a series of new rules introduced to Australia’s gas market in August will make it more difficult for small companies to buy the gas they use to power their homes and businesses.

The new gas buying rules, announced on Wednesday, have been hailed as a “win for the industry” and will “strengthen” Australia’s fledgling gas industry by making it more competitive.

The changes will make gas purchases more difficult in the short term and make it easier to buy more gas for consumers.

“The introduction of the gas buying rule will help the industry to secure an increasingly valuable market share in the gas market,” Australian Gas Association chief executive Peter Hickey said in a statement.

The regulator’s new rules are aimed at ensuring small and medium-sized businesses can continue to sell gas to consumers, while also making it easier for Australian gas producers to sell to the gas sector.

Small and medium sized gas companies are now allowed to buy up to 500 tonnes of gas a year from gas companies, a rise from the current limit of 500 tonnes.

The rules are expected to benefit both Australian gas consumers and Australian gas companies.

“As the number of gas producers grows, they are increasingly likely to purchase gas from the smaller producers,” Mr Hickey added.

“By making the gas purchase rule easier, we are enabling them to do this while ensuring that they have the financial resources they need to sell their gas to Australian consumers.”

Gas prices in Australia have been in the spotlight for a while, with prices increasing from a low of $US3 per million British thermal units (Btu) in April 2018 to $US8 per million Btu in March 2019.

The price of gas is set to be capped at $US2 per million cubic metres (MCM) in 2022, but the gas price could also rise further.

“Australia is a global leader in gas consumption and Australia is currently the largest gas consumer in the world,” Australian Energy Market Operator (AEMO) chairman Andrew Fergus said in an announcement.

“This is a good outcome for all gas consumers.”

Australia is the biggest gas consumer and Australia’s contribution to the global market is set at 50 per cent, according to AEMO.

The move comes after Australia joined the European Union and the United States in introducing their own gas pricing system.

In a statement, Mr Hirsch said the rules “help ensure Australia’s market remains strong for gas producers, while ensuring Australian gas remains competitive”.

“We will continue to work closely with the Australian gas industry and its suppliers to ensure the new rules support the industry’s future growth and success,” Mr Fergus added.

Gas prices will rise in the coming months, with the price of a barrel of Brent crude oil hitting a record high of $1,071 per barrel in June, up from $1.091 in January.

Australia’s biggest producer, Rio Tinto, is one of the biggest holders of gas in Australia.

Rio has long been the dominant gas player in Australia, but this year the company has cut its market share to 13.5 per cent from 18 per cent.

In May, Rio announced a massive $1 billion investment into new gas plants, bringing the company’s gas output to 2.6 million tonnes a year.


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