Gas companies to reserve 20 per cent of supply for Australia under new rule

Thursday, 7 May 2026 17:10

The proposed move is hoped to boost supply and reduce prices.

Gas companies will have to reserve one-fifth of their exports for Australian use first in a proposed move hoped to boost supply and reduce prices.

Energy Minister Chris Bowen today announced the east coast gas reservation policy would mandate the three big Queensland-based gas exporters to reserve 20 per cent of their supply to sell to Australian users from July 1, 2027.

"It will ensure a modest oversupply of Australian gas use, which will put downward pressure on prices," he said at a press conference.

Under the policy, companies would need to show they have met their domestic supply obligations in order to then access the international spot market.

This would apply to new contracts only.

Resources Minister Madeleine King said the rule would shift the bargaining power and create a buyer's market, leading to lower prices.

"Our gas market will no longer be hostage to international markets," she said.

Australia is one of the world's biggest liquefied natural gas exporters but risks supply falling below demand from as early as 2028, according to the Australian Competition and Consumer Commission.

Bowen admitted Australia was the only country in the world without a gas reservation despite being advised for decades that gas supply would eventually become an issue.

He and King began consulting with the industry on an overhaul to gas sector regulations late last year.

Greens resources spokesperson Steph Hodgins-May said the policy was "written by the gas industry, for the gas industry" and called for the government to introduce a gas export tax.

Prime Minister Anthony Albanese has rejected the recent push to introduce a 25 per cent tax on gas exports after independent Senator David Pocock revealed more federal tax is paid on beer than on gas exporters.

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