Macrobusiness has an interesting article on the potential for Asian gas prices to converge to US prices.
My guess is that the global shale boom means that the Australian gas investment boom is over. If the Japanese are successful in move pricing off Oil benchmarks it may be uncompetitive before the investment phase is even complete. Certainly, you would have to be an excellent salesman to persuade someone to sign a 30yr petroleum linked contract.
Because of this, it is hard to see another 200bn of gas investment replacing the current crop of projects. This means that mining investment as a share of GDP will drop a few percentage points over the next few years – the policy challenge is to replace that with exports, consumption and non-mining investment.
I am sceptical of the ability of monetary to do this – i suspect that we will require one of a much lower currency or looser fiscal policy (i favour infrastructure investment).
… Meanwhile in coal, i’m hearing of more mine closures from family in the business.