Submission: Domestic Gas Reservation Scheme exposure drafts

24 September 2026

To: Department of Industry, Science and Resources
Re: Domestic Gas Reservation Scheme: exposure drafts

Thank you for the opportunity for the Institute for Energy Economics and Financial Analysis (IEEFA) to provide input to the department’s consultation on the exposure drafts of the domestic gas reservation and associated Bills.

IEEFA is an independent energy finance think tank that examines issues related to energy markets, trends and policies. The Institute’s mission is to accelerate the transition to a diverse, sustainable and profitable energy economy.

IEEFA’s submission outlines feedback on selected aspects of the exposure draft, set out in detail below. In summary, we recommend:

• The government explicitly remove the option for the Minister to set “target aggregate supply” above forecast demand to achieve oversupply (with discretion to set the level of supply between 0-10%) given the potential impacts on broader investment incentives.
• Allow exporters to carry forward “banked” supply (i.e. oversupply) into later years even when they do not have pre-existing supply debt.
• Consider additional safeguards to ensure exporter purchases of domestic gas result in additional gas production.
• Put in place more prescriptive provisions to limit Ministerial discretion, which risks increasing market uncertainty
  • This includes providing clear guidance as soon as possible on whether the government intends to allow Gladstone LNG to extend its Kogas LNG sale and purchase agreements and under what circumstances.
• Limit export licences to 10 years to provide greater certainty and minimise the risk that existing licences will be revoked or varied. This will also broadly align with the timing of expiry of existing LNG sale and purchase agreements (SPAs). 
• Consider whether there is a need for greater price transparency in Western Australia to inform the Minister’s determination of domestic supply obligations for exporters.

Kind regards,

Josh Runciman, Lead Analyst, Australian Gas