The Australian Energy Market Commission (AEMC) has published its final determination and more preferable final rule (final rule) to extend the Declared Wholesale Gas Market (DWGM) Dandenong liquefied natural gas (LNG) interim arrangements.

The final rule enables AEMO to address security and reliability risks in the short-term until an enduring fit-for-purpose solution is implemented.  

Our final rule is largely consistent with the draft rule and provides for:  

• A four year extension of AEMO’s interim buyer and supplier of last resort powers for the Dandenong LNG storage facility.
• A rules-based arbitration mechanism to be called upon if a dispute arises about the extension of the LNG storage agreement between AEMO and the Dandenong storage facility operator, APA.
• Additional measures to limit the costs that AEMO may otherwise incur under the interim arrangements.  
• The permanent application of a targeted set of Part 18 Gas Bulletin Board reporting obligations to the Dandenong liquefaction facility, under a standalone facility reporting model (as opposed to the joint facility reporting arrangement proposed in the draft rule).
• The permanent extension of the Part 19 participant disclosure, LNG storage disclosure, maintenance reporting and coordination obligations to the Dandenong liquefaction facility, to provide AEMO with greater operational visibility of the facility and enable it to perform its declared system functions more efficiently and effectively
• AEMO to only contract for the use of uncontracted LNG storage capacity up to the target level for LNG stock approved by the Victorian Minister (which was not part of the draft rule).

To provide sufficient time for AEMO, APA, and BOC to undertake preparatory actions, the final rule requires:  

• AEMO and APA to have an extended LNG storage agreement in place by 28 February 2026  
• AEMO and APA to enter into a transitional storage agreement so AEMO can retain LNG stock until the extended agreement starts. This arrangement must be entered into by 31 December 2025 (and is a new requirement inserted in the final rule).  
• BOC (as the liquefaction facility operator) to comply with new reporting and maintenance obligations under Parts 18-19 of the NGR from 1 April 2026.  
• AEMO to have made any required changes to Wholesale Market Procedures and/or Gas Bulletin Board Procedure by 1 April 2026.  

Background

On 3 April 2025, the Australian Energy Market Commission (AEMC) received a rule change request from the Hon. Lily D'Ambrosio, Minister for Energy and Resources, Climate Action, and State Electricity Commission, to amend the National ​Gas​ Rules. The rule change request proposed a short-term three year extension of the 2022 DWGM Dandenong LNG (DLNG) interim arrangements and a range of measures to improve transparency and oversight of the Dandenong liquefaction facility.  

On 1 May 2025, the AEMC initiated consultation on the rule change request. We published a draft determination and more preferable draft rule on 7 August 2025.

Context

On 15 December 2022, the AEMC made a final rule to enable the Victorian gas market operator to better manage the risk of curtailment for gas users during the tight demand-supply conditions expected from 2023 to 2025 (National Gas Amendment (DWGM interim LNG storage measures) Rule 2022 No. 4).  

The Commission’s 2022 final rule:  

• empowered the Australian Energy Market Operator (AEMO) to act as buyer and supplier of last resort in relation to the DLNG storage facility for an interim period commencing on 1 January 2023 and ending on 31 December 2025
• set out how AEMO is to perform both the buyer and supplier of last resort functions  
• set out the supporting arrangements, including the contractual, cost recovery and proceeds distribution, and accountability and transparency arrangements that apply to these functions.