In short:
The federal government opens waters off the Victorian and Tasmanian coasts for new gas exploration as it seeks to increase Australia's supply.
The government has faced criticism from environment groups and its own backbench for a gas policy that will keep fossil fuels past 2050.
What's next?
Further permits to explore carbon capture and storage projects are in the final stages of approval.
Permits to explore waters between South Australia, Victoria and Tasmania to establish new offshore gas wells have been approved by the federal government.
The approvals in Commonwealth waters are designed to shore up supplies of gas for the east-coast energy market, where there are concerns about a shortfall if new supplies are not secured.
Both the energy market operator and the competition watchdog have warned of energy shortages within three to four years.
That is despite Australia being one of the world's largest producers of liquid natural gas (LNG). The vast majority of gas extracted in Australia is contracted for export.
Esso and Beach Energy are expected to take up the exploration permits for the Otway Basin, which extends from south-west South Australia to north-west Tasmania, and the adjoining Sorrell Basin to the west of King Island and Tasmania.
The federal government is also offering several exploration permits to resources companies operating off the West Australian coast.
Resources Minister Madeleine King says gas is "critical for the transition" to renewable energy, but insists it will be "a diminishing proportion of our energy mix to 2050".
The federal government is aiming to have 82 per cent of electricity generated by renewable sources by 2030 and to reach economy-wide net zero emissions by 2050.
"As ageing coal generation comes offline in coming years, gas will continue to be needed to firm renewable energy generation and as a back-up during peak energy-use periods," Ms King said.
Labor has been criticised for supporting new gas developments because of their contribution to greenhouse gas emissions, with Labor backbenchers among those raising concerns.
Environmental groups have slammed the decision to grant licences for more gas exploration as a "recipe for climate disaster".
"Rapidly moving from fossil fuels to renewables is a much better way to secure our energy future than to drill for more climate-heating gas that won't come online for years," Australian Conservation Foundation chief executive Kelly O'Shanassy said.
"Saying this gas is for domestic use is no excuse when more than 80 per cent of the gas extracted in Australia is exported, a portion of which could stay in Australia and be used to manage an orderly transition to clean energy."
The resources companies would have to apply for separate approvals and undertake community consultation before gas production was permitted.
Carbon capture permits in final stages of approval
The federal government is also in the process of finalising 10 permits to explore carbon capture and storage projects, an experimental process of pumping greenhouse gas emissions underground.
Environmentalists have slammed the move as a "half-baked idea" and a "carbon-dumping unicorn".
"Carbon capture and storage is prohibitively expensive and can at best only deal with a tiny proportion of Australia's climate-heating emissions," Ms O'Shanassy said.
Greenpeace Australia's Joe Rafalowicz described it as a backwards step for efforts to reduce emissions.
"Billions of taxpayer dollars have already been wasted on the failed carbon-dumping fantasies of gas executives," he said.
"How many times do these projects need to fail before we see them for what they are — a distraction from the clean-energy solutions we have available right now."