sign of things to come

Yesterday's West Australian newspaper carried an article headlined "Coal in demand as WA gas price soars". The article discussed how power producers were turning to coal as gas prices had increased so much. This was the first decline in gas use by power producers since the GFC. Prices had increased to $9 GJ as legacy contracts had expired.

WA is a world class gas province and a large driver for the increase in domestic gas prices is that the majority of gas is diverted to LNG. This is a harbinger of what is to come for East Coast gas. That is BPT can look forward to a gas price around (at least) $7 to $9 GJ and more if it can tap into LNG (Pluto averaged $11 GJ in the last quarter).

Ironically, the move from gas to coal is underwritten by the complete lack of an Energy Policy by the government which has introduced the carbon tax to bring about a clean energy future ( or some such claptrap).