Australia must capitalise on gas deposits, new report claims

Australia s ability to export lng may provide massive economic benefits to the country 16000646 800482778 0 0 7014295 300

Australia's gas industry has become a crucial driver of national prosperity, and the government should be capitalising on this to improve economic growth.

That is according to a new report from the Australian Petroleum Production and Exploration Association (APPEA) and Deloitte, entitled Advancing Australia - Harnessing our comparative energy advantage.

The study, released last month (June 24), found that oil and gas production in Australia contributed two per cent to the country's GDP in 2010 - 2011, the equivalent of $28.3 billion.

“The continued expansion of Australia’s oil and gas industry represents incredible opportunities to all Australians," said APPEA chief executive David Byers.

“We should be capitalising on these opportunities and maximising growth in living standards and employment by efficiently allocating resources."

To do this, Mr Byers believes that Australia must further its global standing as an efficient, low-risk and cost-competitive resources and gas supplier.

He says that greater attention would be required to facilitate effective reallocation of resources in order to raise national productivity.

"Accessing skilled labour is essential for the oil and gas industry ... continued access to overseas labour markets through mechanisms such as Enterprise Migration Agreements is vital," said Mr Byers.

The report also addressed the suggestion of implementing a policy mandating domestic gas reservation throughout the country to ensure that local gas prices remain at a manageable level.

According to the report, such a policy would cause a total economic welfare loss greater than the potential financial gain to domestic users.

Posted by Callum Fleming