Energy in Australia

Overview
Gas — conventional and unconventional — plays an important role in
the Australian economy. Gas accounts for nearly one-quarter of primary
energy consumption, one-fifth of electricity generation, and is one of
Australia’s highest valued commodity exports. More than half of national
gas production is exported, and Australia is currently the world’s third
largest exporter of LNG.
The Australian gas market consists of three distinct regional markets:
• the Eastern market, comprising Queensland, New South Wales, the
Australian Capital Territory, Victoria, Tasmania and South Australia
• the Western market, comprising Western Australia and
• the Northern market, comprising the Northern Territory.
The three markets are physically and economically separate from each
other. They each have different characteristics, including size and location
of gas resources, demand profile, and relative exposure to international
markets. The vast distance between the markets makes interconnection
costly and currently uneconomic. A pipeline to connect the Northern and
Eastern markets has been proposed.
Production
Australia produced 2,587 petajoules (around 66 billion cubic metres) of
natural gas in 2014–15. Gas production increased 6 per cent in 2014–15,
supported by the start-up of the QCLNG project in Queensland. Over the
past decade, Australian gas production has expanded by an average of
5 per cent a year.
Western Australia accounted for 60 per cent of Australia’s total gas
production in 2014–15 (1,616 petajoules). The majority of this production
is slated for LNG exports. Almost all gas production in Western Australia is
in the Carnarvon basin, with a small volume produced in the Perth basin.
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