Australia has softened its proposed domestic gas reservation scheme by making 20% a maximum rather than a fixed requirement and delaying the supply obligation until 2028.

The government is set to backtrack on its plan to force gas exporters to set aside a full 20 per cent of their supply locally and delay the start of the scheme.

The national gas reservation scheme will ensure “modest oversupply” in the domestic market which would make gas more affordable, Energy Minister Chris Bowen said.