Industry backlash threatens Australia’s gas supply fix. Leaders must step up

by bpckle | Jul 22, 2026 | In the Media

Australia is one of the world’s largest exporters of liquefied natural gas (LNG). But it faces domestic gas shortages by the 2030s as old gasfields run dry.

Gas exports from the east coast only began in 2015. Since then, exports have ballooned and domestic gas prices have increased dramatically. Price spikes have driven some manufacturers to the wall. Governments have had to intervene to prevent shortages.

The issue is that gas companies can get much higher prices exporting gas than selling it domestically. And some exporters have started buying gas from the domestic market instead of developing their own resources.

To fix this problem, the federal government plans to require gas companies to reserve gas for the domestic market. When first announced in December, the gas industry was broadly supportive. No longer. The backlash began after the detailed design was released in May. Growing dissent from industry now threatens to derail the plan.

As proposed, the government’s scheme does need some tweaks. But the core mechanics are sound and the key criticism is misplaced. It’s time for the government to explain it better.

What’s the policy meant to do?

The gas reservation policy is designed to force exporters to supply the equivalent of 20% of their exports to the domestic market. The government’s goal is to keep prices down and avoid looming shortages, especially in New South Wales and Victoria.

When the plan was announced, Australia’s oil and gas lobby group backed it. But the Australian Energy Producers group now calls the plan “fundamentally unworkable”.

Gas producer Senex called it “perverse in the extreme”, Beach Energy said the government was “trying to shut us down”, and Santos said it would “kill an industry”. Queensland treasurer David Janetzki said the plan would “undermine the foundations of our economy”.

What happened?

The major bone of contention is how much gas exporters would have to push into the domestic market.

East coast LNG exports are forecast to be about 1,400 petajoules (PJ) next year.

Reserving 20% of that as the government wants would be 280PJ – the equivalent of about 73 large LNG carriers.

But domestic demand is now falling. East coast demand is forecast to be only 441PJ next year, which should be met by existing supply. Adding 280PJ would be a huge oversupply.

For a domestic gas producer to make money, it needs to sell gas at about A$11–12 per gigajoule.

The industry is worried boosting supply could drive prices below the cost of production, potentially driving domestic-only producers broke.

If that happened, supply would fall and prices would rise. This would make matters worse long-term.

This concern is reasonable but overstated

Dire warnings of an oversupply are overstated. The reservation policy has been deliberately designed to manage this risk.

The 20% figure isn’t fixed. Rather, it’s an upper limit on how much gas will be reserved. Most years, the scheme will reserve much less.

Each year, the minister responsible will decide how much gas to reserve, based on two things. One, whether the domestic market faces a shortage. And two, whether forcing a domestic oversupply will keep a lid on prices.

While the final legislation is yet to be released and much could change, if the scheme applied in 2027, here’s how the current design might work.

Australian Energy Market Operator forecasts suggest the east coast will effectively face zero shortfalls until 2030, leaving no gap to fill in 2027. The government has suggested requiring delivery of 5% more gas than forecast requirements so domestic prices drop.

That would translate to an extra 22PJ in 2027, representing about 2% of exports – not 20%. The remaining gas would accrue as an obligation the minister can call on in future years.

The final figure might be smaller still. About 70% of this gas would have to be sold through long-term contracts, leaving 30% able to be offered to short-term trading markets. If exporters can prove this gas has no buyers, they can seek permission to export it. Any reserved gas approved for export remains as an future obligation able to be called on.

All up, this means the policy could require just 16PJ of gas to be delivered domestically in 2027. This scenario would hardly tank the market.

Little time to get it right

The 20% reservation figure is the biggest concern for industry. But it’s not the only one.

Gas companies are worried about too much ministerial discretion, the ability to set obligations across multi-year periods, and potentially massive accruals of “undelivered gas”. These issues are legitimate and need to be resolved.

Under the government’s model, the minister would have substantial discretion to set the annual volumes required. This leaves exporters with no certainty about how much they will be required to deliver each year. To solve this, gas volumes should be set in five-year blocks according to a predictable formula based on supply and demand.

Fixing these issues will be crucial to win over a sceptical industry. But the government wants the scheme to begin on July 1 next year. That doesn’t leave much time to get it right. Legislation would have to be introduced in the September sitting of parliament for the laws to be passed before Christmas.

None of these issues is a reason to back away. Over time, Australia will need to wean itself off gas, which is a potent fossil fuel. But for as long as we still need it, consumers in a gas-rich country should have access to gas at a reasonable price.

Hamish McKenzie works for the Grattan Institute, which has been supported by government, corporations, and philanthropic gifts since 2008. A full list of supporters is published at www.grattan.edu.au.

Alison Reeve works for the Grattan Institute, which is supported by government, corporations, and philanthropic gifts.

We set 10,000 traps in search of a rare native mouse. Here’s what we found

by bpckle | Jul 21, 2026 | In the Media

It’s 5am when we crawl out of our tents.

The catbirds are calling and the night sky is fading to dawn, as we prepare to head into the bush. We’re surrounded by the towering eucalypts of southeast Queensland in search of a small, native mouse called the pookila.

Also known as the New Holland mouse (Pseudomys novaehollandiae), the pookila is about the size of a small chocolate bar, weighing less than 20 grams. These mice spend their nights foraging for seeds and fungi, and their days tucked away in a burrow.

We don’t yet understand what the pookila’s preferred habitat is in Queensland. But these mice can be found in patches along the east coast of Australia, from Queensland down to New South Wales, Victoria and Flinders Island in Tasmania.

Read more: Meet 5 of Australia’s tiniest mammals, who tread a tightrope between life and death every night

However, this little mouse is under the pressures of habitat destruction, climate change and predators, among others. These threats have lead to declines and local extinctions in southern pookila populations.

In the past, pookila have been found incidentally at ten locations in southeast Queensland. But these surveys, many of which were conducted several years ago, weren’t solely focused on searching for pookila.

For our new study, we visited most of these sites over a 31-month period to better understand how pookila are living and what threats they are facing.

Here’s what we found.

Pursuing the pookila

To find the elusive pookila, we revisited seven locations west of Brisbane in southeast Queensland where they had been previously found.

At each site, we camped out for four to five nights at a time. And over our nearly three-year study, we set a total of 10,666 traps.

Each afternoon, we’d set out with our trusty box traps and a healthy supply of peanut butter balls – a commonly used enticing snack for small mammals. We then identified suitable spots to place the traps, ideally where we might find different types of native rodents. We covered each trap with leaf litter, and placed a delectable peanut butter ball inside.

Read more: Why don’t people care about Australia’s native rodents? The problem could be their ugly names

The next morning, we’d return to those same traps, crossing all fingers we’d caught some mice. On some days, the rodents were everywhere. Other days, there were no mice in sight. We worked in all sorts of weather, sometimes basking in sunshine and sometimes powering through drenching rain. On particularly wet mornings, all we could do was trudge back to our tents, soaked and exhausted.

But every now and then, the cheeky resident possums would locate our stash of peanut butter balls and steal them right from out of our traps. That made us smile, or cry.

We repeated this process of setting and checking traps over 31 months, all in search of a tiny native mouse.

During that time, we only found and trapped a single pookila.

So, where are they all?

It’s hard to know exactly what happened to Queensland’s pookila population. Since 1996, only around 125 of these mice have been captured in Queensland. So we currently lack the data needed to understand how the species has fared over time.

But our findings suggest pookila may be facing local declines in Queensland. These mice may also be becoming harder to find because specific populations are shrinking or changing where they are living. Queensland’s pookila could also be facing similar threats to their southern counterparts, including habitat destruction and climate change. Indeed, it may be a combination of all the above.

In any case, our results raise serious concerns about the pookila’s long-term survival in both Queensland and across the country.

This is why continued monitoring is crucial. Resurveying our study sites, and other sites across Queensland, will help us track any trends in pookila population numbers. And if we catch more individual mice, we can learn about the species’ preferred habitat and unpack what factors may be driving local declines. We can also identify what conservation actions will be most effective, such as undertaking planned burns to restore habitat.

Other animal encounters

While pursuing the pookila, we encountered several other native rodent species. These include the endangered Hastings River mouse (Pseudomys oralis), graceful eastern chestnut mouse (Pseudomys gracilicaudatus) and stocky swamp rats (Rattus lutreolus).

Native rodents are a crucial, but often overlooked, part of Australia’s ecosystems. They fill various ecological roles, including helping plants and fungi reproduce by scattering seed and spores and aerating the soil by burrowing and foraging.

Our data could tell us more about how Queensland’s other native rodent populations are changing over time, and how we can better protect them.

But we can also help on an individual level, particularly by keeping cats indoors. Pet cats are skilled predators and collectively kill many native animals each day. So ensuring cats are contained will keep both our pets and native wildlife safe.

We can also conserve the habitat of all our native rodents. We still don’t fully understand what kind of habitat each species prefers. But to protect the pint-sized pookila, landholders and conservation groups can start by maintaining fallen logs, native grasses and other forms of shelter.

Meg Edwards has received funding from the Department of Environment, Tourism, Science and Innovation. She is a member of the National Pookila Recovery Team and the Australian Mammal Society.

Abby Dennien receives funding from the Australian government Research Training Program Scholarship. She is a member of the National Pookila Recovery Team and the Australian Mammal Society.