Coal seam gas processing plant
Coal seam gas processing plant Simon Green

Campaign to reserve gas as exports rise

UNIONS and the aluminium industry have joined forces to call for a new policy to reserve gas for domestic consumers, fearing huge increases as exports ramp up.

The Australian Workers' Union, Alcoa, Australian Paper and the Australian Council of Trade Unions launched a new campaign on Monday.

A coalition of the heavy industries and unions, called the "reserve our gas" campaign, released research showing prices could rise to up to $18 a gigajoule, from about $3 a gigajoule, when the domestic price rises to meet the global market.

But the campaign was met with derision from the gas industry, with the Australian petroleum Production and Exploration Association labelling it a call for a "free lunch" from its customers.

A BIS Shrapnel report commissioned by the campaign found rising gas prices could see one in five heavy manufacturers shut down in five years, taking thousands of jobs with it.

It also found household gas bills could rise by up to 26% in the three years from 2015, while the profits of the booming gas industry would go mainly to offshore shareholders.

The campaign comes as gas exports are set to ramp up on the east coast, particularly through Gladstone, with the first expected LNG plant there to begin exporting next year.

AWU national secretary Scott McDine said Australia was "the only nation on earth" letting exports extract its gas and then sell it back to local consumers at global prices.

"Australians have a right to know their rapidly rising gas bills are actually completely preventable," he said.

"We just need to do what every other gas-exporting nation does and bring in laws to look after the local population.

"Australians should pay the Australian price for gas - not the global price - because it's our gas."

However, both the previous Labor government and current Abbott government opposed domestic reservation policies on the grounds they made Australia less competitive.

APPEA chief executive David Byers underlined such arguments, saying any subsidies or cheaper prices for Australian consumers could hit the economy for more than $6 billion in foregone business activity.

"The simple fact is that Australia's interests are best served by access to open and competitive markets," he said.

"The fact that natural gas is now Australia's third largest export sector is something Australians should celebrate, and self-serving calls to undermine one of the economy's shining lights should be ignored and condemned."


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