Opening Statement | Inquiry into the role of Western Australia in the global effort on decarbonisation
Economics & Industry Standing Committee:
Inquiry into the role of Western Australia in the global effort on decarbonisation
25th February 2026
Opening Statement
Chair, Deputy Chair and Members, thank you for the opportunity to appear today.
I’m here on behalf of the Domestic Gas Alliance.
I’m joined by a representative from one of our member organsations, Nick Rea, Manager - Wholesale and Low Carbon Fuels at Wesfarmers Chemicals, Energy & Fertilisers.
We’re a member-driven industry body representing Western Australia’s large domestic gas users.
Our members include Cockburn Cement, Alcoa, Coogee Chemicals, Wesfarmers Chemicals, Energy & Fertilisers, Tronox and Yara Pilbara, and collectively they account for around 60 per cent of WA’s gas consumption.
Their businesses span manufacturing, mining and minerals processing, chemicals and fertilisers, and the service and logistics supply chains behind them.
They are significant employers and major contributors to WA’s economy.
From our perspective, gas matters for two core reasons.
First, domestic gas is one of the few inputs that has enabled Western Australia to consistently process and value-add onshore.
As a State and Nation, we grapple regularly with how we add-value to our natural resources. We are very good at extraction and export. But if we are to realise a future made in WA or Australia, we must do more with what we have here in Australia.
Domestic gas generates eight times as much economic activity in the State as gas that is exported – it has been assisting us to value-add for decades.
It is a critical industrial feedstock – take for example ammonia: a molecule of gas becomes part of product which then underpins downstream essentials like fertiliser for agriculture, ammonium nitrate for mining explosives, and inputs like sodium cyanide used to extract gold.
It also provides reliable high-temperature process heat for key industrial processes helping keep more of the supply chain, jobs and economic value here in WA as opposed to exporting resources in a less processed form.
Second, gas provides firming capacity for our electricity network and decarbonisation agenda.
As we move from coal to renewables, we must be able to meet demand and maintain the integrity of the grid.
The Australian Energy Market Operator’s latest Gas Statement of Opportunities identifies that gas consumption for gas-powered electricity generation will continue playing a critical role in WA’s main power grid.
The outcome of failing to acknowledge and put the right policy settings in place to ensure gas is available will be widespread blackouts and potentially de-industrialisation as businesses are forced to close their doors.
The east coast is a live example of what WA must avoid - but is likely to experience if we don’t maintain a supply of reliable gas for the domestic market and enforce our domestic gas policy.
The Alliance was formed in 2006, at a time of serious supply shortage, for a simple purpose: to ensure WA’s domestic gas market settings deliver the supply certainty and price stability that underpin jobs, investment and regional economic activity.
Nearly 20 years on, we are again facing supply shortages, with the Australian Energy Market Operator’s latest Gas Statement of Opportunities warning of shortfalls in 2028 and then increasing from 2030.
Despite all LNG producers being required to reserve the equivalent of 15 percent of what is exported, a 2024 Parliamentary inquiry found only 8 percent had been delivered to the WA market.
This shortfall materially impacts the businesses that underpin our economy, jobs and our capability to decarbonise.
Western Australia has a high concentration of hard-to-abate industry so the importance of Carbon Capture and Storage (CCS) in assisting to meet these obligations cannot be understated.
In terms of supply, we recognise domestic gas comes from a mix of sources.
Onshore gas has historically been quarantined for the domestic market, although that has been eroded in recent years as some onshore production has been permitted to access export pathways.
At the scale and consistency industry requires, offshore projects linked to LNG exports with domestic gas obligations will be critical to meet future demand, as will the enforcement of our Domestic Gas Policy.
We understand this inquiry is focused on Western Australia’s contribution to the global decarbonisation effort, including what role our gas may play in this effort.
For the same reasons gas remains critical in Western Australia, it has a role in assisting the energy transition globally.
Western Australia has a reputation as a reliable and innovative trading partner with high ESG standards.
Countries that have constrained renewable energy potential due to factors like geography, climate, or population density, as well as decreasing domestic natural gas supply are expected to rely heavily on LNG.
It is also a critical ingredient if we are to succeed in scaling up our critical mineral processing capability and ensuring global supply chain security.
There are also new opportunities to produce low-emissions ammonia as a marine bunker fuel for the Pilbara's iron ore shipping fleet, or for power generation, where we are already witnessing significant reductions in NOx and SOx emissions in our regional trading partners electricity grids.
Western Australia’s contribution to regional decarbonisation is not something we can do separately from our own transition at home - the two are symbiotic.
If we want to be a credible partner to the region, we need to keep WA’s economy strong while emissions fall and access to a reliable, affordable source of gas is critical to our success.
Our ability to support the region with reliable energy and lower-carbon products depends on getting the domestic settings for energy and decarbonisation right.
It needs to be sequenced and pragmatic and can’t assume overnight substitution without risking production, jobs and investment.
We appreciate the Committee’s consideration and we’re happy to assist further.