Australia Oil and Gas Market: Navigating Growth, Transition and Global Demand

The Australia oil and gas market is experiencing a period of measured but resilient growth as it continues to balance domestic energy needs, export commitments and broader energy transition dynamics. According to the latest IMARC Group analysis, the market was valued at USD 406.0 million in 2024 and is projected to reach USD 711.5 million by 2033, representing a compound annual growth rate (CAGR) of 6.43% between 2025 and 2033.

This growth reflects Australia’s strategic role in global liquefied natural gas (LNG) exports, rising energy demand, ongoing investment in infrastructure and technological advancements across exploration, production and distribution operations. The market’s expansion also mirrors broader geopolitical and regulatory shifts that are shaping how the sector adapts to both near-term energy requirements and long-term sustainability objectives.

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Why the Market Is Growing So Rapidly

1. Strong International LNG Demand

Australia has established itself as one of the world’s leading exporters of LNG and natural gas, particularly to rapidly industrialising Asian economies. Its abundant natural gas resources and developed LNG export infrastructure give it a competitive edge as global energy demand continues to grow, particularly in markets seeking lower-carbon fuel options compared with coal.

2. Rising Domestic Energy Requirements

Within Australia, natural gas remains a key fuel source for power generation, industrial users, and urban consumption. Population growth and expanding industrial activities are driving higher energy demand, which in turn supports upstream and midstream operations. Additionally, natural gas is increasingly viewed as a transitional fuel that can help reduce overall carbon emissions relative to more carbon-intensive energy sources.

3. Investment in Infrastructure and Technology

Investment in upstream production facilities, offshore gas platforms, midstream pipelines and downstream processing capacity underpins the market’s growth. Technological advancements — including digital tools, automation and enhanced drilling techniques — are improving operational efficiency, safety standards and reservoir recovery rates. Adoption of such technologies supports cost-effective expansion across the energy value chain.

4. Regulatory Initiatives and Policy Support

Government policies that support energy security — including initiatives to boost LNG exports and stabilise domestic supply — play a central role in maintaining market growth. At the same time, evolving environmental policies and carbon reduction commitments are prompting companies to adopt cleaner practices, adopt carbon capture technologies, and pursue efficiency gains that strengthen market resilience.

5. Diversification and Energy Transition

The sector is gradually aligning with broader energy transition goals by exploring opportunities such as hydrogen production, carbon capture and utilisation technologies, and repurposing existing infrastructure for low-carbon applications. While traditional hydrocarbons remain central today, these adjacent areas offer future avenues for strategic growth and investment.

What the Opportunities Are

1. Expansion of LNG Export Capacity

With strong demand from Asia and other regions, further investment in LNG liquefaction facilities and export terminals can boost Australia’s market share while creating jobs and economic activity.

2. Enhanced Domestic Supply Initiatives

Developing new gas fields and extending the life of existing reservoirs can help secure local supply, particularly for industry and power generation, and mitigate potential supply shortfalls in Eastern states.

3. Advanced Exploration and Production Technologies

Adoption of digital oilfield technologies, AI-based reservoir modelling, and autonomous operations can enhance recovery rates, reduce operational risk, and unlock value in maturing assets.

4. Carbon Capture, Utilisation and Storage (CCUS)

Implementing CCUS across production operations can help companies meet emissions targets while maintaining competitiveness, presenting new revenue streams from carbon credits and low-carbon product offerings.

5. Hydrogen and Clean-Energy Exports

Leveraging existing gas infrastructure to produce and export hydrogen or hydrogen derivatives positions Australia to capitalise on emerging global clean-energy markets.

6. Strategic Midstream and Pipeline Expansion

Investments in pipeline networks and midstream facilities can improve connectivity between production zones and domestic demand centres while reducing transport bottlenecks.

7. Integrated Energy Services and Digital Platforms

Providing integrated solutions that combine asset optimisation, predictive analytics, and environmental performance monitoring can attract industrial clients focused on efficiency and sustainability.

Recent News & Developments in Australia Oil and Gas Market

• January 2025: Regulatory & Policy Update: Queensland awarded new gas exploration acreage to Santos and Drillsearch as part of a broader effort to boost domestic supply and streamline permitting processes. The state’s strategy emphasises the role of gas in the national energy mix for decades to come, even as climate policies evolve.

• June 2025: Industry Investment & Expansion: Chevron approved a USD 3 billion expansion of its Gorgon gas project in Western Australia, aimed at sustaining offshore production and supporting both domestic energy reliability and LNG export capacity. This major capital deployment reflects long-term confidence in Australia’s gas sector despite regulatory headwinds.

• September 2025: Market Dynamics & Corporate News: Santos Ltd. experienced market volatility after the collapse of an USD 18.7 billion takeover bid led by Abu Dhabi’s ADNOC unit. While the failed acquisition impacted share prices, analysts noted future production prospects from domestic and international projects could bolster long-term revenue streams.

Why Should You Know About the Australia Oil and Gas Market?

For investors, the Australia oil and gas market represents a strategically important segment within the energy sector. With projected growth from USD 406.0 million in 2024 to USD 711.5 million by 2033 at a 6.43% CAGR, the market offers steady demand and export-driven opportunities.

For energy companies and service providers, the evolving landscape around LNG, infrastructure investment and technological innovation creates potential for differentiated offerings, operational optimisation and expansion both domestically and regionally.

For policy makers and planners, understanding the interplay between domestic energy security, export commitments and environmental objectives is critical for shaping regulatory frameworks that balance growth with sustainability. As Australia navigates energy transition pressures while maintaining global competitiveness, strategic policy decisions will have long-lasting impacts on the sector’s trajectory.