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April 10th, 2013 
ENERGY industry heavyweights have warned they may be forced out of NSW by a “perfect storm” of rising prices and supply problems.
At an industry conference in Sydney on Wednesday, AGL Energy group general manager Mike Moraza said NSW had run out of time to ward off a gas crisis.
“We are facing a crisis, that’s a fact,” he said.
“We’ve run out of time. We are not going to be able to fill those supply gaps that are going to emerge at the end of 2016.”
Mr Moraza said that not all existing customers would fall “in the supply camp”.
“We do have a situation in this state where policy is being made on the run, not based on any evidence or scientific information, and it’s a perilous situation,” he said.
Last month the NSW government responded to community concerns by announcing tough new coal seam gas regulations, including a ban on CSG drilling near homes.
AGL boss Michael Fraser on Wednesday stepped up his attack on the restrictions, warning of a “perfect storm” of rising prices and short supply.
Mr Fraser said failure to develop large coal seam gas reserves in NSW would leave the state vulnerable to the loss of manufacturing industries and jobs as affordable energy would not be available.
“Whichever way you look at it the east Australian gas story is a coal seam gas story,” he told the conference.
Dart Energy responded to the government’s restrictions by axing 70 per cent of its workforce and suspending field operations at Fullerton Cove, near Newcastle.
Dart CEO Robbert de Weijer told the conference the company was looking to invest in the UK and would only reconsider NSW once it gets clarity and certainty from government.
Mr de Weijer said NSW was facing “a perfect storm”.
“I believe there is going to be a crisis in terms of gas prices that are going to be very, very high and there is a number of large industry users basically not being able to afford them so they will be driven out of the state.”
Kieran Donoghue, from the Energy Supply Association of Australia (ESAA), said there needed to be consistent and predictable regulation – “and to not have regulation where you don’t need it, where markets can find a solution”.
“I don’t think we see that either upstream or downstream at the moment.”
Santos used the conference to unveil a plan to produce enough coal seam gas, from wells in the Pilliga state forest near Narrabri, to provide one-quarter of NSW gas supply by 2016.
But Mr Moraza suggested it was unlikely to be ready by then, saying “that is a very ambitious timetable”.
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