Photo: Courtesy of Australia Pacific LNG

ACCC: QLD LNG producers to coordinate gas plants upkeep

The Australian Competition and Consumer Commission (ACCC) has proposed to reauthorise Australia Pacific LNG, Gladstone LNG, and the Queensland Curtis LNG Project to coordinate maintenance of their LNG plants for another five years.

ACCC: QLD LNG producers to coordinate gas plants upkeep
Courtesy of Australia Pacific LNG

This would mean that all three applicants can coordinate when and how maintenance of their gas plants occur, and when their facilities will be taken offline.

The facilities convert natural gas into LNG for export. Each LNG facility is connected to gas wells in the Surat and Bowen basins of Queensland. They also purchase gas in nearby wholesale markets. When any of the LNG facilities are offline, they may redirect their gas to wholesale markets for sale. The LNG facilities use very large quantities of gas and can have significant effects on the market price when their facilities are offline.

The ACCC first authorised maintenance schedule coordination in 2016. Tis required that applicants publicly disclose information they share between themselves. The ACCC proposes to reauthorise the arrangements with the same condition to ensure the applicants do not have an information advantage.

The LNG producers asked for this condition to not be required once transparency measures are implemented under the National Gas Law. The transparency measures will likely be implemented during the five year period of reauthorisation and will require LNG producers to provide detailed information, including forecast maintenance events in the coming 12 months.

However, coordination by the LNG producers about maintenance plans more than 12 months into the future would not be reported under this law, and that could be detrimental for other market participants.

The ACCC is now consulting on the draft determination.

The ACCC invites submissions on the draft determination and proposed condition by 25 May 2021. The ACCC will then make its final decision.

More information on how to make a submission is available here.