Updated domestic gas policy to secure WA's energy future

• WA's Domestic Gas Policy updated to secure a strong economic future for the State
• 80 per cent of onshore gas production reserved for domestic use until 2030, to facilitate new project development
• 100 per cent of onshore gas production reserved for domestic use from 2031
• WA's landmark 15 per cent offshore reservation policy to continue
• Stronger application of "use it or lose it" provisions for onshore gas licenses
• Measures to support affordable energy, local jobs and WA's economy, as WA transitions to a clean energy future

The Cook Labor Government is taking action to deliver energy security and a strong economy as the State transitions to a clean energy future, today releasing an update to the State's landmark Domestic Gas Policy to encourage new onshore gas development.

Under the updated Domestic Gas Policy, onshore gas projects will be required to reserve 80 per cent of gas production for WA domestic use up until 31 December 2030, after which projects will be required to reserve 100 per cent for the local market.

Allowing new gas projects to export a reasonable proportion of production over the next five years will help to stimulate development while WA's gas market is balanced, and ensure more gas is brought to market in decades to come - helping WA to continue its transition to renewable energy, backed by gas as a firming fuel.

The revised policy will apply to new onshore gas projects or existing projects seeking to expand production. An exemption will remain in place for the 'first-mover' in the Canning Basin, to encourage development in the State's north.

The Waitsia project will retain its domestic gas reservation obligations and export permit, issued under the 2020 COVID-19 exemption, however the State will consider options to facilitate other gas producers to share their infrastructure - providing faster access to market for new projects.

WA's successful 15 per cent reservation for offshore LNG projects remains unchanged.

To further accelerate onshore gas developments, the Cook Government has also committed to strengthening use of 'use it or lose it' provisions in the Petroleum and Geothermal Energy Resources Act 1967.

This change will help to prevent land banking of onshore petroleum tenements and ensure more gas is brought to market over the coming decade.

The Department of Energy, Mines, Industry Regulation and Safety will conduct a review of the legislation to determine how best the strengthened 'use it or lose it' policy can be implemented.

The Cook Government will also deliver more transparency around the Domestic Gas Policy, having worked with industry to publish an annual WA Domestic Gas Statement - showing how gas producers are meeting their domestic gas obligations.

The effectiveness of the WA Domestic Gas Statement will be reviewed after 24 months, with the Government to consider legislating the transparency measure if required.

The update follows a review of the policy led by the Cook Government over the past nine months, including detailed industry consultation, and is part of the Government response to the WA Parliament Economic and Industry Standing Committee's Inquiry into the WA Domestic Gas Policy.

More information on the Domestic Gas Policy and the State Government's full response to the Parliamentary Committee's report is available at https://www.wa.gov.au/government/announcements/domestic-gas-policy-updated-secure-was-energy-future

Comments attributed to Premier Roger Cook:

"Our gas belongs to Western Australians, and I want to make sure we maximise the benefit to our State from our gas resources.

"As we phase out coal-fired power and transition to a renewable energy future, WA needs a secure supply of gas as firming fuel in our system and to help us to become a global renewable energy powerhouse.

"WA Labor's Domestic Gas Policy has underpinned WA's economic success over the past decade, and under my Government, the policy will set up our State for our clean energy future.

"This update provides certainty for gas producers and users, helping to facilitate new onshore gas projects - creating local jobs while ensuring our energy needs are met.

"The Domestic Gas Policy has been crucial to keeping WA's gas and electricity prices among the lowest in the nation.

"Our policy supports affordable, reliable energy for WA households and businesses into the future.

"Only our WA Labor Government can be trusted to deliver the Domestic Gas Policy, because only our WA Labor Government will do what's right for WA."

Comments attributed to Mines and Petroleum Minister David Michael:

"These policy changes are sensible responses that balance the need for Western Australia to secure its energy future while encouraging onshore producers to bring on more gas supply as and when it is needed.

"Gas has an important role to play in our economy as we transition to renewable energy sources and WA Labor's Domestic Gas Reservation Policy will continue to guarantee that reliable supply.

"I look forward to the outcomes of DEMIRS review of the Petroleum and Geothermal Energy Resources Act 1967 to determine how best we can strengthen the 'use it or lose it' policy to ensure it remains fit for purpose."

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