Australian Domestic Gas Security Mechanism Review 2019

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Publication Date: 
January 2020

The Australian Domestic Gas Security Mechanism (ADGSM) was established in 2017 to ensure there is a sufficient supply of natural gas to meet forecast needs.

This statutory review assessed if the ADGSM is still fit for purpose to deliver a functional domestic gas market.

The review found that the ADGSM has been working effectively to safeguard domestic gas supplies, and recommends:

  • retaining the ADGSM until its scheduled repeal in 2023
  • considering a change to the Total Market Security Obligation to better enable it to recover sufficient gas in the unlikely event of domestic shortfall
  • amending the ADGSM’s guidelines to reference the Australian Competition and Consumer Commission’s LNG netback price series in estimating a potential shortfall


Recommendations 1 and 3 have now been implemented.

Government did not agree with Recommendation 2 (amending the Total Market Security Obligation). Instead, the Government negotiated a new Heads of Agreement with east coast LNG exporters.

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