*

Shell, ExxonMobil ( XOM ), Chevron ( CVX ) warn against government

intervention

in energy market

*

Gas reservation plan would not solve domestic supply

shortfall,

they say

*

Chevron ( CVX ) says energy security has become a 'political

football'

(Updates throughout with comments from ExxonMobil ( XOM ), Chevron ( CVX ))

By Christine Chen

SYDNEY, April 1 (Reuters) - Global gas giants said on

Tuesday an election campaign proposal by Australia's opposition

coalition that would force producers to direct more export gas

into the domestic market would deter investment without tackling

looming shortages.

Energy has emerged as a major campaign issue ahead of the

May 3 general election, with the conservative Liberal-National

coalition pledging to bring down power bills through a gas

reservation scheme.

The centre left Labor government of Prime Minister Anthony

Albanese introduced a price cap on gas wholesale prices in 2022,

and has implemented regulatory and other measures to meet

domestic energy needs and reduce emissions.

At a conference in Sydney, Australian executives of Shell

, ExxonMobil ( XOM ) and Chevron ( CVX ) pushed back on

the coalition's proposal, arguing more government intervention

would hamper the development of gas supply.

Cecile Wake, chair of Shell Australia, which exports gas

from the Queensland Curtis LNG project in the state of

Queensland, said export controls were not the solution.

"The fact that the easiest lever the federal government now

has to solve the southern gas problem is export controls, is not

a reason to pull that lever harder," she said.

"This does not increase supply; it simply redistributes it

and when coupled with price caps and other market interventions,

it can impede investment and exacerbate the challenge."

Australia exports more gas than it consumes, but its major

reserves are located mostly in the northwest, far from the

southeast where most people live and demand is highest. The

competition regulator has warned eastern states could face a gas

shortage by 2027.

Opposition leader Peter Dutton's plan would force exporters

on the east coast - mainly QCLNG and Australia Pacific LNG

operated by ConocoPhillips ( COP ) - to direct 10% to 20% more

product into the domestic market, with the extra supply coming

from uncontracted gas sold on international spot markets.

Chevron Australia managing director Mark Hatfield contrasted

Dutton's proposal with a gas reservation scheme in the state of

Western Australia, where Chevron ( CVX ) is a major producer.

Its prospective application allowed the company to assess

the policy before signing long-term contracts, which was "quite

different" to Dutton's plan, he said.

"Energy security is an easy target to be a political

football ... some of the things we're seeing right now is maybe

some short-term fixes that could have long-term implications

with negative outcomes," Hatfield said.

ExxonMobil Australia, which produces gas in the Bass Strait,

the main supply source for the eastern states, said expanding

production was "the key to ensuring reliable and affordable

gas".

"Regulatory restrictions that prevent or impede development

of new gas supply have become worse and risks that are normal in

oil and gas markets such as geologic and engineering risk have

been replaced by government policy and regulatory risk,"

commercial director David Berman said.