The head of chemical manufacturer Orica says the current record gas prices are not sustainable.
The company's Kooragang Island plant, which produces mining industry explosives, accounts for about 15 per cent of the gas consumed in NSW.
More than $200 million has been invested upgrading various aspects of the plant over the last three years.
Orica chief executive Sanjeev Gandhi said the current $30 to $40 per gigajoule spot prices for gas were "not sustainable" and warned there was a risk manufacturers would go offshore if gas prices remained at current levels.
"When we invest in a factory for 30, 40, 50, 60 years, we need to have an outlook, we have to have a clear vision as to: 'should I be investing capital in manufacturing in Australia? Or should I take my capital somewhere else? Because we have more favourable conditions?' It's a critical discussion."
Pressure is mounting on the federal government to intervene in the market amid exporters enjoying large profits caused by the war in Ukraine.
Energy Minister Chris Bowen told parliament last week that the government's work on lowering prices was continuing.
He said gas prices had lifted by 270 per cent under the coalition's watch.
"The gas companies would say that's fantastic but Australian consumers would not," Mr Bowen said.
The Australian Competition and Consumer Commission is investigating the option of requiring gas suppliers to abide by a "reasonable pricing" principle requirement in an effort to control gas prices.
Business Hunter chief executive Bob Hawes said the business chamber had been fielding an increasing number of calls from members who were concerned about the rising cost of energy, in particular gas.
"The price increases have leapt energy costs up the priority list relative to other expenses like materials and wages. It has suddenly become a tipping point for whether the business can produce at an acceptable price or not," he said.
"We know there are businesses that have contracted in good faith to supply a particular good at a particular price and now face the prospect of not being able to meet their obligation at a price and margin that makes it viable to do so. This is not a comfortable position for any business to be in."
Mr Hawes said most businesses had little ability to negotiate prices for new energy supply contracts.
"The retailers are not looking long term and are keeping their options open which is understandable because they don't want to be caught if we have a recurrence of the circumstances we saw in May and June this year," he said.
"We can not imagine there is a business anywhere in the region that has not been exposed to or is not experiencing cost increases in relation to the supply of energy including gas for their operation. Budgets are being smashed and there is no doubt the government is well aware of this and impacted as it is also exposed owing to their own operations across realms like health."
The 2019 the Business NSW report "Running on Empty" forecast ongoing price rises for households and business in NSW as consequence of NSW "importing 98 per cent of its gas requirements within a constrained national gas market.
"We're living with this now and the urgency to do something about it is acute," Mr Hawes said.
"Unfortunately the solution isn't simple or quick and requires a combination of actions. This includes the urgent need to increase the supply and availability of gas; accelerate efforts to improve the energy efficiency of business and industry; turbo charge efforts to bring on materially significant supplies of renewable energy and look to assist business and industry to convert from gas to adapt to renewable energy supplies including the potential for hydrogen."
