MELBOURNE, May 5 (Reuters) - Australia's Origin Energy
said on Wednesday it has lined up a four-year natural
gas supply deal with Australia Pacific LNG (APLNG) starting from
2022 that could help fill a shortfall looming in the country's
Pricing for the 91 petajoules of gas will be tied to the
Japan Korea Marker benchmark price, Origin said, which is
typically used for spot liquefied natural gas (LNG) cargoes in
Northeast Asia and not for domestic purchases.
"Origin has taken a major step towards securing gas supply
for domestic customers, particularly in southern states, through
a period in which (the Australian Energy Market Operator) has
identified a potential shortfall for the market," Greg Jarvis,
Origin's energy supply general manager, said in a statement.
APLNG, which produces gas in the northeastern state of
Queensland for the domestic market and for export as LNG, will
ramp up volumes for Origin during Australia's winter months,
when household heating demand shoots up in the southern states,
the companies said.
The Australian winter coincides with periods of low LNG
demand during northeast Asia's summer.
Origin has also lined up extra pipeline capacity under a
three-year deal with APA Group starting in 2023, which
will allow the company to transport large amounts of gas to
southern markets where it is needed.
With that deal in hand, APA said on Wednesday it would go
ahead with a A$270 million expansion of its network from
Queensland to the southern market.
Origin had considered buying gas through an LNG import
terminal planned by Australian billionaire Andrew Forrest's
Squadron Energy at Port Kembla in New South Wales.
Squadron was not immediately available to comment on what
impact Origin's decision would have on the Port Kembla project.
(Reporting by Sonali Paul; Editing by Christian Schmollinger)