A major forecast gas shortage in Western Australia is now expected to be less severe and arrive later than previously feared, though the state is still on track to face significant deficits in the next decade.
Revised Forecast Shows Near-Term Balance, Future Gaps
New analysis from the Australian Energy Market Operator (AEMO) indicates the domestic gas market in WA will stay broadly balanced in the near term. However, a shortfall equal to roughly 7 per cent of the market is now anticipated in 2028, which is smaller than earlier predictions.
AEMO's Executive General Manager for WA, Kirsten Rose, confirmed the updated outlook. To avoid even this reduced deficit, new supply projects would need to come online faster, or more production from existing facilities would have to be directed to the local market.
The projections show that gas demand in Western Australia is set to peak in 2030, after which it will begin a slow decline as the state pursues its net-zero emissions targets.
Major Projects and Pipeline Constraints Loom Large
Looking further ahead, the projected deficits grow larger, potentially surging beyond 140 terajoules per day by the mid-2030s, representing a substantial 12 per cent of the market.
Potential new supply sources, such as Woodside Energy's giant Browse project and Equus Energy's Equus field, are considered possible but remain uncertain. Developments at the Lockyer and West Erregulla fields, linked to Hancock Prospecting, are factored into supply forecasts for later this decade, but any delays would worsen the shortage.
AEMO also issued a warning that even if these major investments proceed, constrained pipeline capacity could become a critical issue as soon as 2029.
The Changing Role of Gas in a Renewable Future
Industrial use will be the primary driver of gas consumption, while demand from gas-fired power generation is expected to become more volatile and seasonal. Kirsten Rose explained that gas will increasingly play a supporting role, backing up renewable energy during periods of high demand or when solar and wind output is low.
WA's Energy Minister, Amber-Jade Sanderson, said the report demonstrates the state's energy transition in action. She emphasised that renewables, storage, and gas firming remain the lowest-cost pathway for supplying electricity as WA aims to become a renewable energy powerhouse.
However, Climate Analytics analyst Piers Verstegen argued the projections are not inevitable and serve as a warning. He urged for stronger policies to replace fossil gas with cheaper, cleaner renewables and storage, including by electrifying mining and processing. He also called for stricter enforcement of gas reservation rules on LNG exporters.
This debate unfolds as the state government continues negotiations with Woodside Energy to secure more gas from the Pluto project, which Minister Sanderson said are "progressing."
In a related development, the Economic Regulation Authority approved a 33 per cent increase in usage charges for the Dampier to Bunbury Natural Gas Pipeline. This will cost users an extra $1 billion over the next five years for the state's main transmission line, owned by the Australian Gas Infrastructure Group.
ERA boss Steve Edwell noted that while gas demand is expected to decline in the long term on the path to net zero, the timing remains unclear. He pointed out that current demand is strong and growth is possible through the development of onshore gas fields in WA.
