CEO Mick McCormack caused some consternation in the upstream sector earlier this year when he said the gas crisis was not about supply but pricing.
Yet he told Energy News yesterday that he still holds grave fears for the south-east in 3-4 years if Victoria and New South Wales don't start allowing onshore exploration - and in the same way he said the future depends on the Northern Territory doing the same.
Jemena recently confirmed it had already started investigating expanding the under-construction Northern Gas Pipeline further south from Mt Isa to the Wallumbilla Gas Hub to further integrate NT gas into the east coast gas grid.
Existing gas resources and NGP capacity from the Eni-operated Blacktip development will not meet the east coast's rising demand.
McCormack said even allowing drilling on a case-by-case basis, where environmental checks could be made would be better than a blanket ban, which he said was "patently stupid".
He said that while some in the market were trying to portray the energy crisis as one of gas supply, since the market intervention of the Turnbull government more gas was flowing south, and Energy Minister Josh Frydenberg recently reportedly said spot prices at Wallumbilla had fallen from $12/GJ to $6.
"In our system [the gas] was going north to the LNG projects, now it's coming south, so that's telling us the industry is responding in the right way and gas is coming into the south-east," McCormack said.
"In the short-term there is no shortage, it's a price issue, and that's played out as we speak with gas now coming to the south-east.
"In the medium to longer term there will be a gas shortage because we're not producing any gas.
"The solution is to have those moratoria lifted so exploration and production can bring more gas on in the next 3-4 years. We can't just rely on what is happening with the LNG projects to satisfy the south-east demand indefinitely, because those projects were set up to supply an export demand."
Battery doubts
Victoria yesterday unveiled a new state-based RET with a commitment to power up to 25% of its needs from renewables by 2020 and 40% by 2025.
Part of the government's strategy involves backing the construction of two large-scale solar farms in regional Victoria which will provide another 140MW, and has set up a reverse energy auction system to bring forward an additional 650MW in supply.
South Australia, Queensland and the Australian Capital Territory have also tried boosting investment in renewables to cut their reliance on fossil fuels through strict renewable energy plans with ambitious deadlines.
Yet McCormack said the intermittent nature of renewable power generation was still a clear and present danger to reliability as batteries were yet to be proven on a large enough scale, and "something has to fill that gap, which in our view is where gas will come in".
"The market talks about batteries but in our view the technology is not there," he said.
While SA's government has invested heavily in celebrity innovator Elon Musk's efforts to build the world's biggest battery to be co-located with Neoen's Horsdale wind farm, McCormack said many questions still linger.
"Yes, spend a lot of money on batteries, but we haven't seen the cost benefit analysis done; I don't think anyone has an understanding of what the actual benefit is to the grid of that big battery," McCormack said.
The Commonwealth's Australian Renewable Energy Agency announced on Tuesday it will fund $12 million of the $30 million total cost of a 30MW large-scale battery that promises to deliver both regulated network services and competitive market services, unlocking the full potential of a battery.
Transmission network provider ElectraNet will design, build and own the battery at Dalrymple substation on the Yorke Peninsula and lease out the commercial operation to a major energy retailer, with the battery to be operational by next February.
The development is the second phase of the Energy Storage for Commercial Renewable Integration project.
An Oakley Greenwood report penned by experts from the University of Queensland and the Australian Institute of Energy - released in March and commissioned by the Commonwealth - showed renewables are crowding out gas plants.
While the ability to switch gas contracted for use in power stations into LNG exports and high gas prices allowed some generation owners to optimise their portfolios, this led to the mothballing or change in operations of gas-fired power stations like Swanbank E and Darling Downs.
At the time AEMO was tracking 130 new power station developments in eastern Australia with total nameplate capacity of 8500MW, 4500MW of which are gas-fired, including Braemar Stages 3 and 4 and Darling Downs Stage 2.
