THE state government has warned of gas shortages emerging in NSW within the next two years as it puts its weight behind coal seam gas to head off any supply disruptions.
Large numbers of Nationals and Liberal Party MPs are opposed to allowing the widespread use of coal seam gas due to environmental concerns, especially over the likely impact on aquifers in farming areas.
In its submission to the federal government’s draft white paper on energy, the state government has warned gas could begin to run short in NSW from as soon as 2014, as long-term supply contracts from the Cooper Basin in central Australia begin to expire.
At the same time, oil and gas reserves in the Bass Strait,are running out, which will place further pressure on NSW to find additional sources of gas.
The warnings come as the power industry is moving to use gas to replace coal as its preferred source of energy to generate electricity as a result of the carbon tax which is to begin from midyear and may make it uneconomic to use coal.