Australia’s natural gas endowment has been estimated to be 132 trillion cubic feetas of 2012 and Australia is the world’s third largest exporter of liquefied natural gas(LNG). Due to the qualities of natural gas products, there has been a recent increase in worldwide demand and this has created pressure to exploit Australia’s natural gas resource. The Council of Australian Governments (COAG)recognizes that a significant transformation is occurring in the gas market and that there is a need for the Australian government to guide gas market development and provide certainty for all stakeholders. The future aimfor Australia’s significant gas resource can be gleaned from the Energy White Paper 2015, which is to increase the supply of gas in order to meet domestic and international gas demand. This chapter questions whether the Australian government’s adoption of the market-based policy and its intention to ‘not pursue national reservation policies or national interest tests’ for natural gas is the best approach to benefit the current and future generations of Australians. This chapter also addresses Australia’s energy security and emissions with regard to transportation fuels as it is currently dependent on imported oil and diesel. In this respect, the Australian government’s Strategic Framework for Alternative Transport Fuels states that from now until 2030, Australia has an opportunity to lay the foundations for a market-based diversification of its transport fuel mix. Despite recognizing this opportunity, the current Australian government policies including taxation policies do not encourage a shift from the use of oil and diesel to the use of natural gas products for Australia’s domestic transportation.