Natural gas prices are falling fast in Australia, and are now trading at a low level as the commodity is under pressure from a growing glut of cheaper Chinese-produced gas.

    News.ca.gov.au asked Xoom CEO Ian Chappell why the company had gone for the cheapest natural gas available at the moment.

    “We’ve had a good year,” Mr Chappel said.

    Xoom, based in Adelaide, is the largest natural gas producer in South Australia and one of Australia’s largest employers.

    The company had previously announced it would cut about 6 per cent of its workforce by the end of the year to reduce its reliance on imported natural gas.

    Mr Chappels company is one of two natural gas producers in Australia to have a gas price of $US1 per million cubic metres.

    However, the company’s price is about half that of rival competitor Xomp Resources, which operates in the Northern Territory.

    It is also cheaper than the national average of $1.60 per million – a $US3.50 difference.

    Australia’s natural gas price is one-fifth that of the global average, which is $US4.55 per million.

    Natural gas prices fluctuate as demand increases and decreases.

    In 2017, the average price of natural gas was $US5.23 per million tonnes, but the price has been rising steadily in recent years.

    At the time of writing this, the price was $1,959 per million tonne.

    But the average natural gas cost in 2018 is now $US2.85 per million tons, which means the price of Xoom’s gas has dropped by $US600 per million kilograms.

    Despite the drop in the price, Mr Chaffney said Xoom would continue to produce gas for the foreseeable future.

    What is Xomp?

    Xomp Resources has two major operations in Australia: one in the Pilbara and another in the Hunter Valley.

    Its main production sites are in South West and the Northern Rivers, while its third major operations are in Victoria.

    While Xomp is a gas producer, it is also a producer of gas liquids, which can be used in the liquefaction process.

    This liquefied natural gas is used in refineries for heating, refrigeration and power generation.

    As of April 2020, Xomp’s production capacity was about 2.2 million tonnes of natural-grade gas per annum, and it had a net carbon footprint of about 1,500 tonnes of CO2 equivalent.

    Why Xomp has such a low price in 2018?

    The reason why Xomp chose to reduce staff is due to the rapid increase in demand for gas and natural gas liquids in the domestic energy market.

    When natural gas prices fell in 2019, the industry was able to increase its production and reduce its carbon footprint by increasing production at its three main facilities.

    That is what Xomp was able do because natural gas supplies are very tight.

    So, as demand for natural gas continues to fall, Xoom decided to focus on the price that is right for the long term.

    There has been a significant drop in supply of natural, low-carbon gas liquids over the past year and a half.

    A major source of natural gases is the coal industry, which has been experiencing significant decline in its production capacity, due to climate change.

    Because coal is a key source of electricity generation, it has also been the most significant source of carbon emissions for the past five years.

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