Thursday, 9 June 2016
Turnbull Government will increase support for gas industry and coal seam gas exploration if re-elected on 2 July 2016
It has come
to my attention that a number of people living on the NSW North Coast believe
that the threat of coal seam gas mining in the Northern Rivers region has gone
away because communities so successfully resisted Metgasco Limited’s commercial plans to create gasfields in our
midst.
Unfortunately, although the immediate threat may have abated the longer-term threat remains all the
same, as these excerpts from the 6
June 2016 address to an Australian Petroleum
Production and Exploration Association (APPEA) conference by Minister
for Resources, Energy and Northern Australia Josh Frydenberg clearly show:
I’d like to acknowledge
my fellow speakers, APPEA Chairman, Bruce Lake, APPEA Director and Country
Chair for Shell Australia, Andrew Smith, and the Honourable Dr Anthony Lynham
MP.
I would also like to
acknowledge APPEA more generally, and its CEO in particular, Dr Malcolm
Roberts, for their constructive engagement and contribution to good policy that
is in the national interest.
It’s great to join you
for your annual conference, my first since being appointed Minister for
Resources, Energy and Northern Australia.
Since that time I have
always sought to:
·
highlight
the incredible contribution you make to Australia’s economic performance;
·
be
a passionate advocate for the work your members do to support jobs and grow the
Australian economy;
·
celebrate
the successes of the industry, including first gas at APLNG and Gladstone LNG
on the East coast and at Gorgon on the West coast; and
·
champion
the extraordinary innovation in the sector, from Shell’s Prelude FLNG facility
to the autonomous underwater vehicles operating on the ocean floor at the Pluto
project.
These early experiences
have highlighted the importance of building on Australia’s strong international
reputation as a reliable energy supplier and attractive place to invest, as
well as the innovative and resilient nature of the people working in the sector….
Importantly, our LNG
export capacity will continue to ramp up through several new projects which
have recently commenced production and further projects which are under
construction and due to come online over the next few years.
These projects together total
around $200 billion in capital investment.
They include three Coal
Seam Gas based LNG projects in Queensland (Queensland Curtis LNG, Gladstone LNG
and Australia-Pacific LNG) which commenced production over 2015 and early 2016….
The continued sustainable
development of the nation’s mineral and energy resources is a priority for the
Turnbull Government.
Our policies will:
·
cut
red tape, including streamlining environmental approvals processes;
·
drive
jobs and growth by cutting taxes;
·
create
new market opportunities;
·
de-risk
exploration;
·
support
innovation; and
·
increase
community engagement and understanding.
We stand by our record
since being elected.
The carbon tax is gone;
so is the mining tax.
In just two years, we
have cut more than $4 billion per annum in red tape.
The Coalition remains
committed to one-stop-shops for onshore environmental assessments and
approvals, having achieved it for offshore petroleum activities in Commonwealth
waters…..
At the same time as we
create new export opportunities, we are very focused on attracting greater
investment by de-risking exploration.
We understand that
exploration is a necessity for the industry – and that’s why we are committed
to making Australia as competitive as possible.
As announced in the
Budget, the Government will provide $100 million to fund the Exploring for the
Future programme to be delivered through Geoscience Australia over the next
four years.
Exploring for the Future
will produce a resources prospectus covering targeted areas of northern
Australia and parts of South Australia.
This programme will
deliver new pre-competitive geoscience to assist industry in better targeting
onshore areas likely to contain the next major oil, gas and mineral deposits…..
Firstly, our Growth
Centre Initiatives.
National Energy
Resources Australia (NERA) was launched earlier this year, and is one of six
industry-led Growth Centres.
The Growth Centres are
tasked with driving collaboration, innovation, and international
competitiveness in targeted areas of competitive strength and strategic
priority in the Australian economy.
The sector focus for
NERA is oil, gas, coal and uranium – Australia-wide – and covering the full
breadth of industry activities from exploration and development, construction,
drilling, production and operations, to decommissioning…..
The Coalition has
committed $15.4 million over four years to NERA with an additional $17.2
million for Project Funds to be matched by industry on projects with sector
impact…..
APPEA plays an important
role in enhancing the transparency around industry activities. At the last COAG
Energy Council, I proposed and the Council agreed that APPEA would produce an
annual unconventional gas activities report to provide a consistent, national
information source on activities across all jurisdictions.
Among other things, this
report will include, where available, the number of wells drilled, the number
of land access agreements in force, the extent and type of community
engagement, and the contribution unconventional gas activities make to
government revenues.
But we must also
acknowledge that there are members of the community that have raised concerns
about the processes involved in developing gas from unconventional sources.
These concerns must be
discussed and addressed if we are to successfully develop the new gas supplies
necessary to support Australian homes, businesses and the broader economy.
The Coalition has been
consistent in its support for the responsible development of unconventional gas
strongly underpinned by the best available science……
To further our
commitment to better inform the community of the scientific evidence in this
area, today I announce that the Turnbull Government will make $4 million
available for the CSIRO to undertake further research and to engage with the
community using the Gas Industry Social and Environmental Research Alliance, or
GISERA model….
State-specific research
programs will be established in partnership with State Governments and industry
that wish to work with the Turnbull Government to address community questions.
In particular, GISERA
will address community concerns by:
conducting new research
in key areas such as surface and groundwater, agricultural land management,
biodiversity and socioeconomic impacts and opportunities;
·
establishing
a Regional Advisory Committee;
·
implementing
a communications program using trusted science-based information;
·
generating
advice for governments and industry;
·
improving
community understanding of the benefits and impacts of onshore gas development;
and
·
strengthening
the linkages to key stakeholder groups in gas development regions.
We know that there is no
substitute for community engagement and robust science if we are to bring more
gas to the market.
I look forward to
working with my State and Territory counterparts, and the companies operating
in each state, to expand GISERA wherever there are communities that would
benefit from scientific research into unconventional gas activities…..
It is clear that your
industry is absolutely critical to the continued strength of the Australian
economy.
As we now continue the
transition to the production phase of the current resources boom, and look to
take advantage of future opportunities, we must not compromise all the hard
work and investment that has got us to this point.
Sadly, under pressure
from the Greens, the Labor party has managed to destroy the vital
bipartisanship which existed for over a decade under Ian MacFarlane, Gary Gray
and Martin Ferguson in this area of national economic importance.
Resources Minister Josh Frydenberg has acknowledged as
recently as last month that the gas market needs to be reformed but, on the
back of the ACCC report, has suggested the answer lies in pipeline regulation
and moving away from blanket moratoriums on "certain" gas
developments – meaning bans on CSG developments – which should instead be
managed case by case.
The
Sydney Morning Herald,
7 June 2016:
The big environmental
issue of the last NSW election was coal seam gas. And while the gas industry
and its lobbyists keep waiting for the controversy to go away, gas looks set to
play a major role in the federal election too.
To recap, the NSW
government's support of CSG hit the Nationals hard at the state election. They
lost one formerly safe seat and lost another. The Libs took notice – CSG info
sessions were then held in Northern Sydney Liberal branches.
The government killed
off some gas projects, hoping to put gas on the – ahem – back burner, but
recent events continue to turn up the heat in NSW and beyond…..
It's a point worth
thinking about. No matter how much gas we produce, our prices are now linked to
the Asian market.
The gas industry knew
this, of course. In fact, companies like Santos boasted to investors that
opening up gas exports would mean they could charge Australian gas users global
prices.
The industry said
nothing, however, to governments. The Economic Impact Assessments
submitted to state planning agencies barely mentioned the impact on Australian
gas prices.
Australian manufacturers
have been hard hit. They now compete with foreign buyers of gas and can pay
double or triple previous contract prices. The ACCC found that for a period no
gas suppliers would make gas available to Australian
manufacturers.
Deloitte Access Economics found that the increase in gas
prices as a result of CSG exports could cost manufacturers $118 billion by
2021, most of which will go to the gas companies in a $81 billion windfall.
The salt in the wound
for manufacturers is their lobbyists let this happen. After insisting CSG was
an "exciting opportunity", last year Innes Willox, head of the
Australian Industry Group admitted that they had "sleepwalked into gas
exports".
With so much interest in
gas issues and voters clearly ready to punish politicians who get gas wrong,
there is plenty at stake in the coming election.
The Greens position is
simple – they oppose all CSG and most other gas developments.
The Coalition is in a
difficult spot. Pro-industry Liberals are unlikely to sign up for anything the
gas lobby doesn't want, but it isn't their voters that are likely to care.
The Nationals are still
smarting from their electoral losses in NSW. They're the ones that will get
burned if Greens and Labor can make local angst on gas count in federal
electorates.
Labor senses this,
pledging to extend the "water trigger", which makes more gas projects
likely to need federal environmental approval. The gas industry responded with
immediate condemnation.
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