Joint media release with Member for Gippsland the Hon Darren Chester MP
The Morrison Government is partnering with the private sector to unlock more local gas in Gippsland, Victoria, that will help to bolster domestic supply security and put further downward pressure on gas prices.
The Government has finalised a $32 million commercial loan with GB Energy to accelerate the Golden Beach gas production and storage project that will help alleviate forecast gas shortfalls on the East Coast gas market.
The Golden Beach project, offshore from Gippsland, is expected to produce local gas for the domestic market for around two years before converting to an underground gas storage facility. The 12.5 PJ of storage will help meet demand for gas during times of peak demand and keep a cap on prices.
The Golden Beach project was one of four critical gas infrastructure projects identified in Interim National Gas Infrastructure Plan released in May 2021. It is a key focus for the Government's $38.7 million commitment of targeted support in last year's budget to accelerate these priority projects and help alleviate the forecast gas shortfall.
The Morrison Government's National Gas Infrastructure Plan further highlighted the critical need for more storage capacity to deliver greater supply flexibility during winter peaks to help keep the lights on and homes heated in southern Australia.
Given the current European energy security issues, the International Energy Agency (IEA) has also emphasised the importance of gas storage to provide insurance against unexpected events, including cold winter spells. As noted in the IEA's Q1 Gas Market Report, a tight market with low storage levels can drive up gas prices.
Minister for Industry, Energy and Emissions Reduction Angus Taylor said the Morrison Government would provide the commercial loan to help accelerate the project towards final investment decision.
"The Morrison Government understands the importance of unlocking new gas supplies and critical infrastructure, such as gas storage, to build market resilience and put downward pressure on prices," Minister Taylor said.
"Through our gas-fired recovery we have committed to boost the gas market, unlock supplies and ensure Australia has secure and internationally competitive gas supplies to support households and job-creating industries.
"Industry and government have worked together to ensure our domestic gas prices have remained up to 80 per cent below prices seen in Europe.
"It is clear the Morrison Government has and will continue to back the gas sector unlike the Labor Party which will continue to play postcode politics on gas - telling inner-city voters one thing and regional Australia another."
Member for Gippsland Darren Chester said the Government's support for the Golden Beach project is the next step in securing more supply and will help this local project secure further commercial finance.
"Our government is focused on creating jobs and reducing the cost of living," Mr Chester said.
"This is a great investment in future gas supplies for Victorian households and businesses and an important investment in jobs and economic development in the Gippsland region."
GB Energy estimates the Golden Beach project will directly and indirectly support more than 1,700 jobs across the region and help secure affordable supplies of gas over the coming decade and beyond.
