Australia's government is experiencing fierce backlash over a shortage of cheap gas on the country's east coast that threatens to disrupt national power supplies.
Industry players at Wednesday's Australian Energy Conference slammed Canberra over its response to dwindling gas supplies and spiking prices in the east — a gas security mechanism that will restrict exports from the region if the resource become unavailable to domestic users.
Prime Minister Malcolm Turnbull's administration announced the measure in late April after the Australian Energy Market Operator (AEMO) warned of potential electricity supply shortfalls as a result of insufficient gas in a March report.
Turnbull's export controls have raised more question than answers, said Mark Samter, head of Australian energy research at Credit Suisse.
"We don't feel comfortable on what it's trying to achieve. Is it just trying to make gas available to the market or is it trying to secure affordable gas? Those are two very different answers with profoundly different implications for companies."
Canberra's legislation is just a baby step and an awful lot of work needs to be done to bring affordable gas to industrial users, he added.
Australia is one of the world's largest gas exporters but the government's liquefied natural gas (LNG) ambitions and slowing output are hitting the eastern region's supplies and driving up prices.
While the bulk of gas production is concentrated in Western Australia, output in the east has increased significantly over the past year amid rising LNG exports — six LNG trains now operate in Gladstone, Queensland.