Ian Verrender

Morning, Carrington.

How are you?

Well, the policy that was announced yesterday is really – well, a bit of backtracking here.

Late last year, the government announced a gas reservation policy, and it was going to take quite some time to work through the details of it.

So the timing is a little bit odd.

I mean, we've got a federal budget out next week, and we've had, I guess, a really –

quite strident debate about gas taxing just in the past few weeks as well.

So it would appear to be a bit of a, I guess, heading off at the pass strategy by the government to try and bring in something that, you know, placates everybody in this argument.

The details of this scheme have yet to still be properly worked out and I don't think it's going to be put in place until midway through next year now.

Now originally it was supposed to be in place early next year so it's actually been delayed by around about six months.

The problem here is that there are three gas exporters on the east coast.

You've got one that's led by Origin, you've got another one that's led by Shell and a third one that's led by Santos.

Now

The Origin and Shell Lead Consortia both provide gas into the East Coast system.

It's the Santos Export Consortium that does not, because the problem is that Santos miscalculated the amount of gas that it could access in the ground.

It built a facility that was too big for the gas that they had access to.

And then they wrote export contracts off the back of that very large export facility to be able to pay for it.

And of course, what happened was they didn't have enough gas.

So what the Santos Consortium does is that it buys gas out of the domestic system.

And that is why we've had these problems with gas, if not outright shortages, squeeze supply, at least, you know, on the East Coast.