Perth Western Australia

The Australian Energy Market Operator (AEMO) has released the 2022 Western Australia Gas Statement of Opportunities (GSOO), with expected demand to exceed supply from 2023-26 in the ‘base’ case scenario. 

Developed with gas producers, large users and storage plant owners, the 2022 WA GSOO, provides information about the natural gas industry in Western Australia, with AEMO reporting the State will have a “finely balanced domestic market between 2023 and 2032.”

AEMO’s Executive General Manager – Western Australia and Strategy, Kate Ryan, said, “For the period from 2023 to 2026, the Western Australia gas supply-demand balance is tight, with a small deficit of 45PJ over the four years.

“The forecast shortfalls are being driven by changes in production and increased demand, including for gas-powered generation and new resource projects.

“Between 2027 and 2029, supply is expected to exceed demand by 38PJ, helped when Woodside’s Scarborough project is brought onstream. The domestic gas market then moves into a larger deficit from 2030 onwards in line with scheduled coal generation retirements and a decline in production from existing gas fields.”

Possible market variability could see the domestic gas market shift further into either a surplus or deficit between 2023 and 2029, particularly if demand or supply projects are potentially delayed and as industry decarbonisation plans take shape.

“Several solutions are available to alleviate possible shortfalls, including drawing from Western Australia’s existing gas storage, which can deliver up to 210TJ per day, and developing gas fields not currently included in the forecasts, such as Corvus, Lockyer Deep and South Erregulla,” said Ms Ryan.

Demand for gas generation in the South West Integrated System (SWIS) is expected to grow from 127TJ per day in 2023 to 304TJ per day in 2032 as Synergy’s scheduled coal generation retirements proceed, driving up demand for alternative generation to fill the gap. This, combined with committed resources projects, will see an annual average lift of 1.7 per cent in demand.

“The strong linkages between Western Australia’s gas and electricity sectors mean that changes occurring in one sector will have an impact on the other,” Ms Ryan said.

“This reiterates the importance of timely investment in new gas developments, firming technology and storage solutions to maintain a secure and reliable energy system.”

AEMO said there is a large volume of offshore and onshore undeveloped gas that could supply the Western Australia domestic market during the outlook period, but these resources are currently too speculative to include in the potential supply forecasts.

AEMO will continue to monitor the market, working with industry and governments to ensure Western Australia households and businesses are the beneficiaries of safe and affordable energy now and into the future.

The Australian Petroleum Production and Exploration Association (APPEA) released a response to the report.

APPEA Director – Western Australia, Claire Wilkinson, said, “The GSOO reinforces the critical role of natural gas in Western Australia’s economy, particularly in providing reliable energy to the resources sector, and in supporting Western Australia’s broader energy transition as renewable energy generation increases.

“The ability of natural gas to facilitate emissions reduction, such as assisting Western Australia to phase out coal generation and supporting the uptake of renewable energy, means new and ongoing supply is needed.”

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