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Brickworks fears plant shutdown once Vic winter shortages hit

Angela Macdonald-SmithSenior resources writer
Sep 11, 2020 – 12.00am

Brickworks said it had been able to "stabilise" its gas costs in the range of $9-$10 a gigajoule, significantly higher than current wholesale prices, which have been hit by a COVID-19-related drop in demand for LNG in global markets. It said it needed certainty of supply and costs for gas, and so couldn't rely on the wholesale market where there was no guarantee of available volumes on any day.

The company said it understands Victoria has a priority order for requiring large gas users to shut down if a market shortfall occurred, as the Australian Energy Market Operator has flagged as a risk on cold winter days starting in 2023. Under that ranking, its Austral Bricks plant in Wollert, which uses 1 petajoule a day of gas, could be required to shut down even if Brickworks had gas available on that day.

An order by AEMO to shut the plant to conserve gas would force Brickworks to supply its gas to retailers that are short.