...Surplus Gas Benefiting Margins: The margins of integrated Australian utilities have recovered thanks to higher gas volumes and cheaply available surplus gas in Queensland. Gas supply shortages at some Queensland liquefaction facilities will drive further gas volume sales in the short term. The margin recovery will not prove sustainable as these opportunities dissipate. Margins will remain under pressure over the medium term due to difficult operating conditions, including high retail competition and declining electricity demand. Business Profile Supports Credit: The overall credit profile of integrated utilities reflects the strength and flexibility of their business profile, including equity in upstream gas assets. Margin recovery was helped by higher gas-fired generation using cheaply available gas and from accessing markets with favourable electricity prices. Furthermore, utilities with equity in upstream gas will see a significant step-up in their earnings following the start-up of...
