What is the new domestic gas reservation requirement for Australian LNG exporters, and when does it take effect?

Australia will require liquefied natural gas exporters to set aside 20% of new production for the domestic market, effective from July 1, 2027; the rule applies to prospective contracts and the spot market, but not to supply deals signed before December 22, when the government first flagged a 15%–25% reservation level.

Which LNG projects and companies are primarily affected by the new policy, and why?

The policy mainly affects three major Queensland-based LNG projects — Australia Pacific LNG, Gladstone LNG, and QCLNG — and their shareholders, including ConocoPhillips, Shell Plc, Origin Energy Ltd., and Santos Ltd., because LNG projects in Western Australia are already subject to a 15% reservation policy, whereas Queensland exporters currently ship out most or all of their gas, sometimes even buying domestically to meet export commitments.

Australian LNG Projects to Supply 20% of Gas to Local Market

May 6, 2026

Australia mandates new LNG exporters reserve 20% of production for the domestic market starting July 2027 to curb prices. The policy impacts major Queensland projects and shareholders like Shell and Santos, drawing mixed reactions from industry and climate groups.

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