Submission: Senate Inquiry into the Domestic Gas Reservation Bills

29 October 2026
 

To: Senate Economics Legislation Committee
Re: Inquiry into the Domestic Gas Reservation Bills
 

Thank you for the opportunity for the Institute for Energy Economics and Financial Analysis (IEEFA) to provide input to the Senate Inquiry into Domestic Gas Reservation.

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 provided submissions to the Gas Market Review and the reservation scheme design process in August 2025, March 2026, July 2026 and September 2026. IEEFA’s submission to the Senate Inquiry provides excerpts from previous submissions that are relevant to the legislation currently being proposed by the government. In summary, we recommend:

• The government amending the legislation to not allow the Minister to set “target aggregate supply” above domestic demand to achieve artificial oversupply, which IEEFA is concerned could impact on broader gas investment incentives, particularly in the southern states. 
• Consider additional safeguards to ensure purchases of domestic gas by producers actually result in additional gas production. 
• Consider whether there is a need for additional measures to prevent exporters acquiring new gas fields from other operators, which could result in exporters bringing production capacity onto their “books” without any commensurate increase in domestic gas production and domestic supply.
• Limit the term of export licences to 10 years (with exceptions where existing LNG sale and purchase agreements extend beyond a 10-year period) to provide government with more regular opportunities to assess whether licences are warranted, and to avoid the government needing to subsequently revoke licences or vary their conditions. 
• 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.

We also note the importance of the proposed demand reduction flexibility for exporters. 

Kind regards,

Joshua Runciman, Lead Analyst, Australian Gas