Australia Softens Gas Reservation Rule for LNG Exporters
The draft would cap exporters at 20% and let ministers cut obligations when supply is tight, while aiming to keep the market 10% oversupplied.
- On Thursday, the Albanese government released draft legislation for the Domestic Gas Reservation Bill 2026, requiring exporters to reserve "up to" 20 per cent of production for local customers instead of a fixed amount.
- Skyrocketing energy prices and fears of supply shortfalls on the east coast prompted the policy, which aims to protect domestic households without threatening long-term export contracts with Asian LNG buyers.
- Under the modified scheme, gas companies must apply for export licenses starting January next year, with domestic supply obligations taking effect in mid-2028 and a target to ensure 10% domestic oversupply above forecast demand.
- While manufacturing groups hailed the "sensible calibration" as essential, Greens resources spokeswoman Steph Hodgins-May argued the government "watered down" the reserve to "appease the gas industry," claiming it fails to protect Australian households.
- Energy Minister Chris Bowen maintained the goal is "downward pressure" on energy bills, with the reservation obligation potentially reduced if domestic markets are well supplied, providing flexibility for future implementation.
20 Articles
20 Articles
Australia Eases Gas Reserve Rules for LNG Exporters
Australia has revised a proposed rule that would have required natural gas exporters to keep 20% of their output for the local market. Instead, exporters will now need to reserve up to 20% based on decisions made by the energy regulator. This rule aims to ensure an oversupply of 110% of the estimated demand for […]
Did the government back down on its gas reservation policy? No – most changes make sense
After months of gas industry pushback, the federal government has made sensible changes to its much-vaunted gas reservation policy. Instead of forcing gas exporters to supply 20% of their export volumes to the domestic market, they will be made to supply “up to” 20%, with the precise amount set each year based on domestic demand. These details are in the newly released draft legislation. This has been seen as a concession in the face of an inten…
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