Manufacturers seek ‘urgent intervention’ to rein in gas giants

Source: The Age

18th August 2020

Australia’s large gas producers are charging local customers far higher prices than overseas buyers, fuelling demands for urgent intervention and calls for exporters to open their books on pricing.

The latest findings of the Australian Competition and Consumer Commission’s gas inquiry revealed gas exporters are charging locals at least 20 per cent more for gas, with contract prices of $10 a gigajoule – which is $2 more than the export-parity price offered to offshore buyers.

Global coronavirus travel restrictions slashed energy prices, but Australian gas users have voiced frustration that gas giants have not dropped their long-term contract prices. They want them closer to spot prices of less than $5 a gigajoule in the south-eastern states, or liquefied natural gas (LNG) cargo spot prices of less than $2.50 per million British thermal units. More than 95 per cent of domestic gas sold on the east coast is sold under long-term contracts.

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