Media Release
6 September 2026
Follow the money
There are a variety of sayings about investing, and two of the pithier ones are worth remembering this quarter: ‘capital goes where it is wanted and stays where it is well treated’ (Walter Wriston, former Citicorp CEO), and ‘never lose money’ (Warren Buffett). Despite robust long-term demand forecasts for Australian gas, at home and from LNG buyers across Asia, larger listed Australian oil and gas producers are increasingly directing new capital offshore.
Mr Wilkinson said “Woodside alone has committed billions of dollars to developments in the US Gulf of Mexico, Senegal and Louisiana, while Santos is investing in Alaska and Papua New Guinea. If you follow the money, it’s telling us Australia isn’t as competitive a place to invest as it should be”.
INPEX’s CEO made a similar point publicly as far back as 2023, warning Australia was ‘quietly quitting’ its role as a dominant LNG supplier.
Mr Wilkinson commented that “if the trend continues, Australia and the world will keep using gas for decades to come, but less and less of it will be produced here. Investors need to feel wanted, and government support alone does not make a project bankable”.
Australia’s national oil production more than halved in Q2 2026 compared with the same quarter last year, at a time when the country was debating the need to boost supply and build refineries to strengthen its fuel security. National production dropped 3.4 MMbbl (-53.6%) to a record low of 2.9 MMbbl in the latest quarter – one of the steepest quarterly falls in the history of the local oil industry.
On reservation policy, EnergyQuest’s newly released 2026 West Coast Gas Outlook shows the challenges of picking a single gas reservation number. Only around 11% of WA LNG exports were needed to meet domestic demand in 2026, but our modelling shows this climbs to 15% by 2028 and above the Federal Government’s proposed 20% reservation rate by 2031 – a ‘back to the future’ trend returning to reservation levels not seen for more than a decade.
Meanwhile, East Coast electricity market pricing dynamics are shifting. Gas no longer sets the price of electricity as often as commonly assumed – Australian Energy Regulator data show batteries have overtaken gas-fired generation as the more frequent price-setter in New South Wales and Victoria over the past 12 months.
Mr Wilkinson said “you can’t talk seriously about fuel security while local oil production is falling off a cliff. Building more refineries without Australian oil to process is our ‘field of dreams’ moment – build and they will find?”.
Key Statistics
National petroleum production fell by around 5% (12.4 MMboe) in Q2 2026 compared with Q2 2025, its lowest quarterly level since early 2022, led by interruptions at Pluto and Wheatstone.
National oil production more than halved in Q2 2026, down 3.4 MMbbl (-53.6%) to a record low of 2.9 MMbbl – one of the steepest quarterly falls in the history of the local oil industry.
Total LNG shipments were 19.1 Mt in Q2 2026, down from 19.5 Mt in Q1 2026. EnergyQuest estimates national LNG revenue fell to $13.2 billion from $15.3 billion a year earlier, though a rebound in contract prices after quarter-end lifted July LNG revenue to $7.5 billion.
National conventional gas production fell 17.0 PJ (–8.1%) qoq to a record June-quarter low of 192.8 PJ, reflecting lower output across the east coast, WA and the NT.
Attributions and Media Contact:
Rick Wilkinson
Chief Executive Officer
EnergyQuest
Contact: +61 (0) 7 3870 9152
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