Australia needs policy certainty to press its gas supply advantage

By the Editorial Team · Friday, August 7, 2026

Australia’s energy leaders, including Chevron’s Andrew O’Connor, are calling for stable and predictable policies to support ongoing investments in domestic gas production, which is crucial for meeting rising demand and maintaining reliable energy supplies across the country. Without clear regulatory frameworks, key projects like Gorgon and Wheatstone risk decline, potentially leading to supply shortfalls on the east coast by as early as 2027 and threatening Australia’s energy security and export competitiveness.

Australia’s energy sector is increasingly prioritizing reliability, affordability, and security as it faces pivotal investment decisions that will shape the nation’s gas markets on both the east and west coasts for decades. Industry leaders emphasize the need for policy certainty to sustain and expand domestic gas production amid shifting government frameworks and growing demand.

Andrew O’Connor, director of operations and maintenance at Chevron Australia, highlighted a broader energy conversation that now balances emissions reduction goals with the critical need for dependable energy supplies. He noted that gas remains an essential component due to its flexibility and independence from variable factors like weather, which continue to challenge renewable energy sources.

“Gas is a flexible, predictable, long-term energy source,” O’Connor said, explaining that it supports the expansion of renewable energy by providing consistent supply to households, industries, and businesses. Australia’s substantial natural gas resources position the country advantageously against gas-import-dependent neighbors in Asia, but leveraging this advantage requires ongoing infrastructure investment and clear, stable policy settings.

The federal government’s recent introduction of a national domestic gas reservation scheme, intended to secure 20 percent of liquefied natural gas (LNG) exports for local consumption from mid-2027, has intensified discussions on domestic supply frameworks. Major producers, including Chevron, seek clarity on how such policies will interact with existing arrangements before committing to costly investments necessary to maintain production levels at key facilities such as the Gorgon and Wheatstone projects.

The Australian Energy Market Operator’s 2026 Gas Statement of Opportunities forecasted potential peak-day supply shortfalls in southern Australia from 2029 without new investments, while the Australian Competition & Consumer Commission warned of a structural decline on the east coast that could cause deficits as early as 2027.

Chevron’s Gorgon and Wheatstone gas projects alone contribute about one-quarter of Australia’s total LNG output and provide more than 40 percent of Western Australia’s domestic gas supply. Both projects require substantial ongoing capital investment to sustain output as their original gas reserves mature, underscoring the need for a stable regulatory environment.

O’Connor stressed that investment decisions hinge not on the specific direction of energy policy but on its consistency and predictability over the long term. He called for national policy frameworks that acknowledge Western Australia’s established domestic gas market and avoid retrospective changes to existing contracts or arrangements.

Western Australia’s domestic gas policy, which has remained largely stable for nearly two decades, was cited as a benchmark for effective governance that supports investment. O’Connor also pointed to accelerated electricity demand driven by expanding data centers and digital infrastructure as an example of evolving energy needs requiring strategic, long-term infrastructure planning.

“As we face rising demand and evolving markets, Australia’s considerable natural gas resources offer a significant advantage,” O’Connor said. “However, realising this potential depends on sustained investment supported by coherent, long-term policy commitments that underpin energy security for Australia and its regional trading partners.”

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.