a positive

Keep the brain ticking. As a follow on to some good discussion on the cap raising to BOW, the below article I believe adds some creedence to the path that BOW is following; in that they are first building a DOM Gas asset.

With the government alleviating the need to reserve large amounts of the established reserves for the domestic market, you could be forgiven for thinking the majority of the established CSG reserves will be sent overseas to the higher priced markets. This may lead to conditions for better domestic prices (than in a reserved reserved situation).

Cheers,

SF

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http://www.theaustralian.com.au/bligh-changes-tack-on-gas-policy/story-e6frg8zx-1225797533010

Andrew Fraser From: The Australian November 14, 2009 12:00AM

THE Queensland government has decided against declaring that a set percentage of the natural gas to be produced in the state must be dedicated for domestic use, deciding instead that whole gasfields are likely to be reserved for such usage.
Western Australia has reserved 10 per cent of the liquid natural gas output of the North West Shelf for domestic use, and the Bligh government in Queensland caused some drama in the industry when it proposed that 20 per cent of output be reserved for domestic use.

However, Queensland has instead decided to set aside some specified future gasfields for domestic supply if needed, instead of requiring a percentage of gas from all fields to go to domestic supply.

The policy would not apply to gasfields already owned by gas suppliers, and would work by requiring the proposed gas commissioner to specify that certain gasfields could only be used for domestic use.

Liquid natural gas is set to be exported from Queensland from 2014. It has the potential to be a big export earner for the state. But with energy costs set to rise, it could also be an important low-cost energy alternative to coal.

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Elements of the federal government were upset with the Queensland proposal for a 20 per cent limit, arguing that it could turn away foreign investment.

Ms Bligh said the decision gave certainty to the industry.