In a significant move that highlights internal divisions, Labor MP Ed Husic has publicly broken ranks with his party colleagues to demand an end to what he describes as 'profiteering' by gas exporters.
A 'Fundamentally Distorted' Market
Delivering an impassioned speech to parliament, the former industry minister issued a stinging rebuke of Australia's 'timid' approach to gas market regulation. He argued that 'tinkering at the edges' of reform would be insufficient to repair what he labelled a 'fundamentally distorted' gas market.
Husic pinpointed the core issue, stating that higher prices and uncertain supply for domestic users occur 'not because we don't have enough gas, but because the gas that comes from beneath Australian soil is prioritised for customers offshore rather than customers onshore'.
The Call for Sovereign Priority and Cheaper Prices
The MP threw his support behind a motion from independent MP Nicolette Boele, which calls on the government to 'only allow uncontracted gas to be exported after it has been offered to the domestic market at a reasonable price'.
Emphasising a need for a sovereign capacity, Husic declared, 'Our gas, our prices: that should be the bedrock of our thinking'. He proposed that the cost of doing business for multinational gas firms in Australia should include providing gas at prices in line with historic pre-pandemic levels, a rule he said should also apply to any new gas fields opened.
This political pressure comes as the energy regulator has warned of a potential east coast gas shortfall by the winter of 2028. This is despite Australia exporting a significant three-quarters of the gas it produces.
Industry Pushback and Alternative Solutions
The gas industry lobby has argued it could support measures for exporters to set aside extra gas for domestic use, but only if such a move is tied to the development of new gas fields.
However, a recent report from the Institute of Energy Economics and Financial Analysis (IEEFA) contradicts this. IEEFA suggests that the cheapest way to supply Australian consumers is to redirect small amounts of uncontracted LNG from exports to the domestic market, rather than developing new, higher-cost fields.
Independent MP Zali Steggall, supporting Boele's motion, echoed this sentiment, stating, 'We do not need more gas approvals; what we need are rules to ensure more gas stays in Australia'.
The government is expected to announce a new domestic gas reserve policy in the coming weeks, with Industry Minister Tim Ayres recently signalling that a scheme was close to being finalised.
