Customs (Prohibited Exports) (Liquefied Natural Gas—Intention to Consider Determination of Domestic Shortfall Year) Notification 2017

Overview

The Customs (Prohibited Exports) (Liquefied Natural Gas—Intention to Consider Determination of Domestic Shortfall Year) Notification 2017I, enacted on 24 July 2017, represents a significant step in addressing the management of Australia's energy resources, specifically concerning the export of liquefied natural gas (LNG). This notification was issued by Matt Canavan, the Minister for Resources and Northern Australia, acting under the authority provided by paragraph 13GE(2)(c) of the Customs (Prohibited Exports) Regulations 1958. The core purpose of this legislation is to provide the Minister with the formal avenue to consider the determination of a domestic shortfall year for LNG. This consideration is critical in ensuring that Australia maintains adequate domestic supplies of LNG to meet its energy needs and obligations, especially in times when export levels may threaten domestic availability. The notification initiates the process for the Minister to evaluate and potentially determine whether a shortfall exists, thus enabling the government to take appropriate regulatory or policy measures to balance domestic supply and export demands.

Scope and Application

The Customs (Prohibited Exports) (Liquefied Natural Gas—Intention to Consider Determination of Domestic Shortfall Year) Notification 2017I applies to the Minister for Resources and Northern Australia, who is responsible for deciding whether to determine a particular year as a domestic shortfall year for liquefied natural gas (LNG). This decision is significant for entities involved in the LNG industry within Australia, as it affects the export regulations and potentially the allocation of resources to meet domestic demand. The notification initiates the process for such a determination, commencing on the day after its registration, thus affecting any entities engaged in the export of LNG. While the notification is issued under the authority of the Commonwealth, it directly impacts the LNG industry across Australia, as LNG is a critical resource and export commodity for the country. There are no specific exclusions or exemptions stated in this notification, but the application of the Act extends through subordinate instruments that may further detail the criteria and implications of a domestic shortfall year designation.

Key Provisions

The Customs (Prohibited Exports) (Liquefied Natural Gas—Intention to Consider Determination of Domestic Shortfall Year) Notification 2017I, issued under section 13GE(2)(c) of the Customs (Prohibited Exports) Regulations 1958, indicates the Minister for Resources and Northern Australia's intention to consider whether 2018 should be designated as a domestic shortfall year for liquefied natural gas (LNG). The notification, dated 24 July 2017, comes into effect the day after its registration. This notification is a formal step towards assessing potential domestic supply shortages of LNG, which may lead to further regulatory measures. The operative sections of this notification establish the framework for the Minister's consideration of a domestic shortfall year. Section 13GE(2)(c) of the Customs (Prohibited Exports) Regulations 1958 allows the Minister to notify the public of the intention to consider such a determination. This provision is crucial as it triggers a formal assessment process that could result in restrictions on the export of LNG if a domestic shortfall is confirmed. The notification serves as a preliminary announcement, informing stakeholders of the impending evaluation. Under this notification, the Minister is required to conduct a thorough assessment of Australia's domestic LNG supply and demand for the year 2018. This involves gathering and analysing data on LNG production, consumption, and export volumes. The Minister must also consider any potential impact on domestic markets and the overall energy security of Australia. This assessment is a critical step in ensuring that the country's domestic energy needs are met before considering further export restrictions. The notification imposes several obligations on the Minister and relevant stakeholders. The Minister must ensure that all necessary data is collected and analysed accurately to make an informed decision. Stakeholders, including LNG producers, consumers, and exporters, are expected to cooperate with the Minister by providing relevant information and data. The Minister's decision will be based on this information, and transparency in data provision is essential for the integrity of the process. Failure to comply with the requirements outlined in this notification can lead to serious consequences. While the notification itself does not specify penalties, any subsequent determination of a domestic shortfall year and the resulting export restrictions would be governed by the Customs (Prohibited Exports) Regulations 1958. Violating these regulations can result in substantial fines and potential criminal charges. The exact penalties would depend on the specific provisions of the regulations that are triggered by the Minister's determination, but they could include significant financial penalties and imprisonment for individuals found guilty of non-compliance.