About 209,000 people work in manufacturing sectors that rely heavily on gas, and the Australian oil and gas industry directly employs more than 26,000 people.
The Bass Strait is declining as a supplier of cheap and affordable gas. Production from the Bass Strait is predicted to fall by one fifth this year, and the gas that remains is more costly to extract.
We have been fortunate that gas production has increased in other parts of Australia, like the CSG fields of Queensland. The development of these fields will see Australia become the biggest exporter of gas in the world by the end of this decade. The Queensland CSG fields are the only reason that we can respond to the falling production in the Bass Strait.
However, this time last year, Australian gas prices shot through the roof. Gas prices for large commercial and industrial consumers peaked at around $16 per GJ in early 2017, more than three times their historic levels, and some companies were being quoted prices of up to $20 per GJ. These prices were higher than the landed price paid for gas in our major export markets in north Asia.
These high energy prices put at risk thousands of Australian jobs so the government acted to ensure that sufficient gas would remain in Australia at a reasonable price. We introduced the Australian Domestic Gas Security Mechanism so that an Australian Government for the first time had the legislative ability to restrict gas exports in the national interest.