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Market operator confirms gasshortfall risk with low supply

PERRY WILLIAMS

Australia's eastcoast faces the fresh risk of gas shortfalls after the market operator warnedof low supplies, a new concern for households and big users amid a cold wintercrunch.

"The supplyof gas in all or part of the east coast gas system may be inadequate to meetdemand," the Australian Energy Market Operator said in a notice sent tothe gas industry on Wednesday.

Sources said themarket operator was convening a phone hook up with gas players on Thursday todiscuss the unfolding scenario.

The situation hasbeen triggered by the depletion of southern storage inventories, including thelarge Iona gas storage facility in Victoria, along with constrained productionfrom the state's Longford gas plant.

"Reducedstorage facility capacity may pose a risk to gas supply adequacy in southernjurisdictions on peak demand days during the winter peak demand period throughto 30 September 2024," AEMO noted.

An industryresponse could include Queensland producers and shippers delivering gas tousers in the southern states.

The marketoperator warned in March that gas generators may be forced to burn diesel tokeep the power grid running after authorities warned that states face a catastrophicsupply shortfall from next year unless new sources of supply are developed.

RogerD