Source: Bureau of Resources and Energy Economics, TD Securities

The facts

Supply

• Coal seam gas deposits account for more than 80% (36,598PJ) of Eastern Australia's remaining 2p gas reserves - this rises to 119,550PJ if prospective coal seam gas reserves are included
• AEMO forecasts 2p coal seam gas reserves in Eastern Australia to reach 114,296PJ by 2031
• Gas production in the eastern market is expected to grow around 5% per year to 2,492PJ in 2034-35
• By 2035, almost half (45%) of Australia's gas production is expected to come from unconventional gas
• Australia's proven natural gas reserves are estimated to be 110tcf, the fourth largest in the world
• Australia's technically recoverable shale gas reserves are estimated to be 396tcf.
• By 2016 it is predicted that gas demand for LNG exports will exceed 1,000 PJ and could reach 5,000PJ, a scenario that would require the construction of 20 LNG trains
• By 2020, Southeast Asia will have nearly 25 million tons of LNG import capacity, according to some analyst estimates - with countries including Thailand, Malaysia, Indonesia, Singapore, Philippines, and Vietnam expected to have import terminals
• Analysts are predicting LNG export demand to effectively triple east coast gas prices from $3/GJ to as much as $9/GJ, soon after LNG exports start in 2014 and 2015
• By 2030, domestic gas demand across Eastern Australia is predicted to be in the range of 1200PJ/year (41% increase) to 1,850PJ (62% increase)
• Almost 40% of advanced electricity generation projects are in the gas sector and gas-powered generation is expected to grow on average 5% per year, effectively tripling installed capacity by 2020

Carbon Price

• The carbon price came into effect on 1 July 2012
• The Government is planning to close up to 2000mw of high emission coal-fired generation by 2020 to be replaced by gas-fired plants
• Treasury has modelled a 200% increase in volume of gas fired electricity by 2050