(Bloomberg) -- Senex Energy Ltd., controlled by Posco and billionaire Gina Rinehart, will invest A$1 billion ($707 million) to produce more natural gas in Queensland amid concerns from Australian authorities over a potential shortfall of the fuel.
An expansion of the Atlas and Roma North projects in the Surat Basin will lift the supplier’s annual output to 60 petajoules a year by 2025, and deliver additional fuel into the domestic market within two years, Brisbane-based Senex said in a statement on Thursday.
The company didn’t specify the size of the Queensland expansion, but it said in a filing last year that overall production in the year through June 2022 would be as much as 23 petajoules.
A harsh winter, breakdowns and closures at aging coal plants, and a global fuel shortage triggered a dramatic power supply crunch in Australia in June, even though it’s a major coal and natural gas exporter. Regulators have warned eastern areas could face a shortfall in gas supply next year, and Canberra is seeking to extend powers that would allow it to impose emergency export controls.
See also: Top LNG Exporter Australia Is Told to Keep More Fuel At Home
“The recent electricity crisis proved natural gas is critical to providing secure and reliable energy for Australians, and is needed to underpin renewables and replace aging coal generation,” Senex Chief Executive Officer Ian Davies said in the statement.
New gas projects are rapidly becoming a focus of debate over climate action in Australia. Prime Minister Anthony Albanese, who has strengthened the nation’s emissions reduction targets, has faced some criticism over his rejection of a moratorium on new coal and gas developments.
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