Australia’s status as a leading destination for natural gas investment is under threat, with a new report from Wood Mackenzie warning that declining competitiveness could jeopardise the nation’s energy security, economic growth, and emissions reduction ambitions.

The Australia’s Natural Gas Investment Competitiveness report reveals a stark contrast between global and domestic trends.

While global investment in gas exploration has surged nearly 30 per cent over the past five years, Australia’s growth has been limited to just 15 per cent.

The report, which surveyed CEOs of Australian gas producers, paints a picture of waning investor confidence: 95 per cent of respondents believe Australia is a less attractive place to invest than five years ago, and more than 95 per cent reported direct investment impacts from shifting government policy and regulatory settings.

Notably, one in five affected projects have either been cancelled or relocated offshore, and Australia now attracts only 15 per cent of the investment portfolio of major international oil companies — down from 40 per cent a decade ago.

Australian Energy Producers Chief Executive Samantha McCulloch said there is need for  urgent policy reform: “The new political landscape presents opportunities for industry to work with the government and Opposition on bipartisan and enduring policy reforms for Australia’s long-term energy security and economic growth.”

She added: “Australia now trails peer nations such as the United States, Canada, Qatar, Norway and countries in South-East Asia and Africa in key investment areas including exploration and LNG capacity.”

The report highlights that global LNG demand is forecast to rise 58 per cent by 2050, with the Asia Pacific region projected to account for three-quarters of total demand.

Yet, Australia’s investment in LNG capacity is only a quarter of that seen in the rest of the world, and new project waves are now being led by the United States and Qatar, with Australia “no longer featuring significantly”.

Without urgent action to streamline approvals, support infrastructure, and provide regulatory certainty, the report warns that Australia risks missing out on the next wave of global investment — not only in gas, but also in emerging areas like carbon capture, utilisation, and storage (CCUS).