SYDNEY, June 21 (Reuters) - Australia's east is facing a
gas shortage after a cold snap drove up demand for heating and
power while supply dipped due to an extended outage at the
region's main gas plant, the energy market operator said.
To help boost supply, the market operator has asked gas
producers in Queensland state, which include Shell,
Origin Energy ( OGFGF ) and Santos, to send gas to the
southern states.
The Australian Energy Market Operator (AEMO), in a notice
issued late on Wednesday, warned of heightened risks of gas
supply shortfalls during Australia's winter months.
"The supply of gas in all or part of the east coast gas
system may be inadequate to meet demand," the notice said.
Gas demand has surged for power generation at the same time
as heating as the weather conditions have hampered wind and
solar power output, the market operator said.
And demand jumped just as the main gas plant that supplies
the southeastern states, Longford, jointly owned by Exxon
Mobil's ( XOM ) Esso and Woodside Energy ( WDS ), had to cut
production more than forecast for extended maintenance work,
AEMO said.
Australia considers gas a critical element in its transition
to cleaner energy as the country moves rapidly away from its
dependence on coal-fired power stations, and has been reaching
new gas deals to plug the gaps in long-term supply.
But the market operator has been warning about potential gas
shortages, calling for urgent new investment to prevent any
shortfall.
Prime Minister Anthony Albanese said Energy Minister Chris
Bowen would work with the AEMO and the energy industry to manage
gas supply. The market operator held talks with the gas industry
on Thursday, an AEMO spokesperson said.
Shell, Origin and Santos spokespeople did not immediately
respond to requests seeking comment.
"We will work those issues through with AEMO ... this is not
the first time that has been declared," Albanese told ABC
television, but said the country does need more gas in the east.
Australia produces more gas than it needs to meet its
domestic demands, but most supply is contracted for export.