Growth in the Natural Gas Market...

The gas industry in Australia serves some 2.9m customers and generates annual sales of about $4.5bn, including $1.4bn of liquefied natural gas exports.

From 2000 to 2010, Australia’s natural gas consumption is forecast by ABARE to increase from around 900 PJ/A to over 1500 PJ/A, an increase of over 65%. The majority of this increase is in the quantity of gas used for industrial and power generation purposes.

Is Supported by Australia’s Shifting Energy Consumption Trends.

Energy consumption in Australia has experienced sustained growth for many years. Since 1970 consumption of coal, oil and natural gas has increased from 2140 PJ to an estimated 4940 PJ in the year 2000. Consumption is forecast by ABARE to exceed 6000 PJ by 2015 with natural gas the most significant contributor to this growth. Over the next 15 years the natural gas market is expected to increase its share of the primary energy market from its current level of around 20% to an estimated 28%.

And Underpinned by Our Commitment to the Environment

Natural gas is one of the cleanest burning and more environmentally acceptable fossil fuels. Using natural gas as an alternative to other energy sources is likely to assist in reducing Australia’s overall green house emissions. These have been specifically targeted by the Commonwealth government under the 1998 Kyoto Agreement.
As a significant owner of Australia’s gas transmission infrastructure, APA is ideally positioned to participate in this growth through increased utilisation and expansion of APA’s initial assets.

Pipelines Linking Communities

In Australia, there are relatively few producing gas fields and these are generally located in very remote areas. In contrast, the principal gas markets are generally concentrated around the major population centres. As a result the vast majority of gas consumed in Australia is transported long distances through transmission pipelines. For the most part these pipelines connect one source of supply with one market. There has historically been little interconnection between the discrete pipeline systems.

No longer government owned

The majority of the early pipelines constructed in Australia were government owned. Until 1994 only Queensland and the Northern Territory had predominantly privately owned transmission infrastructure. In 1994 the Commonwealth sold the Moomba to Sydney Pipeline and associated laterals to an AGL-led consortium. The privatisation trend continued so that by the end of 1999, all major transmission pipeline systems in Australia were privately held.

Growth supported by development potential

The growth potential in this industry is likely to come from three sources:

• New transmission pipelines to service the increasing demand for gas and consequent development of new producing fields
• Interstate interconnect pipelines as well as the possible development of major transnational pipelines into south east Australia from remote gas fields
• Expansion and extension of existing pipelines through capacity enhancement as well as the development of extensions, new laterals and interconnects.