The Abbott government is stepping up pressure on the states to foster "the responsible development" of coal seam gas and other unconventional gas sources.
Its Domestic Gas Strategy, released this week, blames "regulatory uncertainty" over the development of new onshore gas resources as one of the reasons gas prices have spiked. Other causes include the linking of the domestic market to international prices following the CSG boom in Queensland.
"Australia is an energy superpower and some of our most significant opportunities for growth will come from our onshore gas assets," Ian Macfarlane, Minister for Industry and Science, said. "We must ensure that we develop our energy assets in an environmentally and economically responsible way."
The strategy singles out NSW, Victoria and Tasmania as imposing "moratoria that effectively block the development of new supply", although it notes NSW's Gas Plan may provide industry certainty and help open up new sources.
The NSW government welcomed the strategy "as an endorsement of the aims and approach taken" towards onshore gas production, a spokesman for Energy Minister Anthony Roberts said.
In a nod to community concerns, the paper acknowledges protection of water resources is among the top challenges holding back projects.
The government's "three principles" for CSG development include that access to agricultural land should only proceed with the farmer's agreement and fair compensation. There must also be no long-term damage to water resources used for agriculture and local communities, and prime agricultural land "must not be compromised for future generations", the strategy said.
Groundswell Gloucester, a group opposed to AGL's plans for a CSG gas field in northern NSW, said the report wrongly assumes "the science is all in and that all they need to do is explain to stupid community members that everything will be okay in the end".
"We know from Gloucester that the whole process is flawed and that the community gets no say unless they force the company and the authorities to listen," John Watts, a spokesman for the group, said.
The strategy paper follows projections released by the Australian Energy Market Operator that previously forecast gas shortages in NSW are unlikely before 2034.
