Australia’s east coast gas market is forecast to have a surplus of between 69 and 110 petajoules in 2025 if Queensland’s LNG producers export all of their uncontracted gas, the ACCC’s latest gas inquiry report shows.

While there is forecast to be an overall surplus next year, there is a risk of a shortfall in the third quarter when demand for energy is typically higher due to demand for heating in winter. The risk has reduced with the extended operation of Eraring Power Station but, if a shortfall does occur, LNG producers will need to commit a small amount of additional gas to the domestic market to ensure there is sufficient supply.

Gas will also need to be sent from Queensland to southern jurisdictions (the Australian Capital Territory, New South Wales, South Australia, Tasmania, and Victoria) to avoid local shortfalls in both the second and third quarters of 2025.

As in recent years, the outlook for 2025 is sensitive to several factors, including variable demand for gas-powered generation induced by weather events and unscheduled maintenance and outages in the electricity network. The variability of demand for gas and reliance on interstate transfers of gas emphasise the need for sufficient gas pipeline and storage capacity, in addition to gas production.

“Since the introduction of conditional exemptions from the Gas Market Code, there appears to have been an increase in the amount of gas being contracted between producers and buyers for supply in 2024 and 2025,” ACCC Commissioner Anna Brakey said.

“While the increase in contracting activity is a positive sign, more time is needed before we can see what impact the Gas Market Code is having on the operation of the gas market, including how suppliers are making their gas available to the market as well as engaging with gas buyers.”

The report covers the first four months of the Gas Market Code’s full operation, and this was a period of relatively quiet market activity.

Given this, there is not sufficient data in this report to draw conclusions about the impact of the Code on prices. Further, the ACCC expects that most gas produced in 2024–25 will not be subject to the Code’s price rules. Some additional supply secured under conditional Ministerial exemptions from the Code may help ease pressures in 2024 and 2025, but much of the potential additional gas identified via conditional Ministerial exemptions will not become available until at least 2026.

The latest report’s forecast remains on track with previous forecasts for the fourth quarter of 2024. A small surplus of 7 petajoules is forecast if Queensland’s LNG producers export all their current uncontracted gas, or 19 petajoules if they only export their currently anticipated spot sales.

The report found that east coast gas market prices have continued to decline from their highs in mid-2022 and are now closer to levels last seen in early 2022. This decline can be seen in both producer and retail prices.

The prices offered by producers for 2024 supply fell by two per cent between August and December 2023 to $14.32 per gigajoule. The prices offered by retailers for 2024 supply also fell over this period, by 16 per cent to $16.51 per gigajoule.

Figure 1: Forecast east coast supply-demand balance in 2025 (PJ)

A graph explaining the forecast east coast supply-demand balance in 2025 (PJ)

Source: ACCC analysis of data obtained from gas producers in January 2024 and of the domestic demand forecast (Step Change scenario and coal retirement delay sensitivity) from AEMO's 2024 GSOO.

Note: Totals may not sum due to rounding. The quantity required to meet long term LNG SPAs includes feed gas requirements (such as fuel) required to produce LNG. The GPG figures in this chart are based on the coal retirement delay sensitivity from AEMO’s 2024 GSOO and so incorporate the effect of the extended operation of Eraring Power Station.

Net withdrawals from storage reflect single party-owned storage facilities on the east coast, which can experience net withdrawals or net receipts each year. This differs from storage to meet seasonal shortfalls from third party-accessible storage facilities, such as the Iona storage facility in Victoria, which are more likely to be filled and emptied throughout each year.

Long-term supply outlook

Forecasts indicate that the east coast gas market may experience gas supply shortfalls as early as 2027 unless new sources of supply are made available. This predicted shortfall is likely to take place one year earlier than what previous reports have forecast, with the extended operation of Eraring Power Station improving the outlook for 2027 but not altering the fundamental trajectory of supply. The forecast of earlier emerging risks is due to an increase in forecast gas consumption for gas power generation as well as a decrease in forecast supply due to delays in new gas projects and production problems in legacy gas fields.

The report found that the southern states are expected to rely on gas transported from Queensland for the foreseeable future unless new sources of supply are made available, without any change in demand. From 2029, Queensland will also require new sources of supply.

However, this report does not incorporate all potential volumes of gas that may come online under the Gas Market Code exemptions framework. If all producers proceed with the projects identified in their conditional Ministerial exemptions, and the potential of those projects is realised, then this will delay east coast shortfalls to 2028.

“With long term export contracts for LNG producers due to expire from the mid-2030s, this presents a critical opportunity for policy considerations that promote efficient and more secure domestic gas supply as well as the export of gas,” Ms Brakey said.

Figure 2: Forecast supply and demand in the southern states 2026-36

Graph showing forecast supply and demand in the southern states 2026-36

Source: ACCC analysis of data obtained from gas producers as at January 2024 and domestic demand from AEMO's 2024 GSOO. This chart does not include the effect of the Eraring Power Station’s delayed retirement, which will likely significantly reduce GPG demand.

Note: This chart includes forecast production from developed and undeveloped 2P reserves in the Gippsland, Bass, Otway, Sydney, Gunnedah and Cooper basins. Additionally, it shows the maximum amount of LNG that can reportedly be imported through currently planned LNG import terminals. The actual amount of LNG imported is likely to differ depending on demand for gas through this source.


In 2017, the Australian Government directed the ACCC to conduct a wide-ranging inquiry into the supply of and demand for natural gas in Australia, and to publish regular information on the supply and pricing of gas. The ACCC will conduct the inquiry until 2030 after the Government extended it 2019 and again in 2022.

On 11 September 2023, the Gas Market Code came into full effect after a two-month transition period. The Gas Market Code aims to achieve its objectives through a combination of pricing requirements, greater transparency on available gas to the market, and the establishment of a more level playing field between buyers and sellers when negotiating wholesale gas supply agreements.

The ACCC’s June 2024 interim report findings reflect a point in time assessment based on information collected directly from gas producers and retailers, and the Australian Energy Market Operator. Market and policy developments may affect the actual outcomes experienced on the east coast.

The ACCC’s next report on the gas inquiry’s supply-demand outlook will be published in September 2024, and the next full interim report is scheduled for December 2024.