Ian Verrender

And then when they started actually after the plant was built or while the plant was being built, they tried to source the extra supply of gas and they failed.

So they didn't have the supply of gas to justify the size of their plant and they'd sold far too much in the way of forward contracts to Asian buyers.

So that left them with a shortfall.

And how did they fill their export contracts?

They went into the domestic market and bought gas out of the domestic market.

So they essentially raided the domestic market, took gas out, and that forced the price of Australian domestic gas much higher.

Well, it's one of those extraordinary events, I guess, where a threat that's overhanging everything has more impact than the actual law that's about to be imposed.

So after years of just outrage and uproar, particularly from domestic manufacturers here who use a lot of energy, but also from households across the country,

The government last year threw caution to the wind and went, right, okay, East Coast, we're going to have a gas reservation policy.

It works on the West Coast.

Why can't it work here?

And by that stage, the three exporters basically threw up their hands and went, oh, okay.

So late last year, the government said, we're imposing this.

We've gone through the whole consultation process, which of course was, I think the decision was made before the consultation process started.

We're going to impose this tax.

Now, here's the general model that we're going to impose, which will be that each of the three exporters will have to be providing gas into the domestic system.

That's going to be very hard for Santos, which has got the shortfall.

The other two, one's run by Origin, the other one's run by Shell, they have consistently provided gas into the domestic system.

It's the Santos consortium that sucks it out.

So they've said this is going to be the general model, but we've got to work out how the whole thing works.