A new agreement has been struck between the federal government and major gas exporters to prevent a looming shortfall in the market next year.
Resources Minister Madeleine King said the signing of a revised heads of agreement followed negotiations with gas companies.
As part of the agreement, gas producers would add an extra 157 petajoules to the gas market next year.
It comes after the consumer watchdog warned earlier this year of a likely shortfall in the domestic market.
Ms King said Australian customers would not pay more for gas than international customers under the new agreement.
“This agreement will ensure Australians continue to have access to secure and reliable gas,” she said on Thursday.
“The new supply commitments, and heads of agreement, will deliver gas to the domestic market when needed, and ensure future uncontracted gas will be offered to the domestic market first.”
Ms King said she did not need to pull the trigger on Australia’s domestic gas supply mechanism as a result of the agreement.
Following the new agreement, gas exporters will need to report to the minister every quarter on what steps they are taking to supply gas to the domestic market.
The Australian Competition and Consumer Commission will also have oversight of exporters.
Ms King said the agreement would not impact the supply of Australian gas overseas and would not affect contracts already in place.
“Australia has a stable energy policy and a clear path forward working with the state’s industry and investors on addressing the mess left by the former government,” she said.
The minister said the new agreement would help to lower prices of gas going forward.
“There is no doubt gas prices are very unlikely to fall to the low points of $6 or $8 or even $10 (a gigajoule), but I do expect with increased supply, there will be downward pressure on prices,” Ms King said.
Industry advocates the Australian Petroleum Production and Exploration Association said the agreement would bring more competitive prices to customers.
The association’s chief executive Samantha McCulloch said the agreement confirmed commitments to the domestic gas supply.
“The industry has always been committed to delivering reliable and competitive priced gas supplies to the domestic market, and today’s agreement confirms that,” she said.
“The importance of gas in our energy mix has never been clearer. Australian households and businesses can be assured that local supply will continue to be prioritised.”
The association also welcomed the government’s announcement there would not be a need to pull the gas security mechanism trigger.