Sharryn Jackson (Hasluck, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Prime Minister. Will the Prime Minister update the House on developments in the past hour in Australia’s resources sector?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the member for Hasluck for her question. Last week I had the opportunity to visit Barrow Island in WA to receive a briefing on the proposed Gorgon LNG plant for the joint-venture partners.

I see the WA members may be gearing themselves up for another walkout. Is that right? I would have thought all members of this House would appreciate news on a positive economic development for the country—perhaps not the WA members from the Liberal Party.

Gorgon is one of around 80 resource projects which have been committed or proposed around the country. These projects, if they come to pass, will create demand for up to 70,000 construction jobs. Gorgon alone would require some 6,000 people at the peak of the construction. This presents, of course, a major challenge for government and industry to ensure that projects have the skilled workers they need. For this reason, the government has established a National Resource Sector Employment Taskforce. I am pleased to advise that the establishment of this task force has received a very positive response from both industry and the Western Australian government.

Furthermore, what we must do is avoid the simple repeat of the mistakes of the previous decade, which saw the emergence of not just a whole range of infrastructure bottlenecks but skills bottlenecks as well. Therefore we need a better effort at coordinating what can be done to provide the skilled labour as well as the infrastructure necessary to support this great expansion of our national economy. Therefore what we intend to do is to work closely with industry and with state and territory governments to help increase the supply of skilled labour—boilermakers, construction workers, riggers, logistics, transport, hospitality staff, the whole box and dice—who actually make these huge projects work on the ground. Furthermore, in the case of the Gorgon project we will also employ a major project employment coordinator, simply because of the intensity of the skills ask out of that single project, which is massive.

For the benefit of the House, I have further positive news about the Gorgon project which I draw to the attention of honourable members. Chevron Australia has, a few minutes ago, announced in Perth that it has signed three binding LNG sales purchase agreements, for nearly three million tonnes per annum of LNG into Japan and South Korea. The first of these agreements is with Osaka Gas, for the supply of 1.375 million tonnes per annum. The second is with Tokyo Gas, for the supply of 1.1 million tonnes. The third is with GS Caltex in South Korea, for the supply of 0.5 million tonnes per annum for a period of up to 20 years. I am advised that these contracts could deliver in the order of $70 billion worth of exports for Australia over the next 25 years.

It has been a great month for the Australian LNG export industry, with our first long-term contract to supply India, worth $25 billion; our biggest ever single trade deal, a $50 billion contract with PetroChina; and, today, further details of deals of the same magnitude—in fact greater magnitude when combined—with Japan and Korea. These are massive projects that will generate economic growth, income, jobs and prosperity for the nation for decades to come. In light of this announcement, I congratulate Chevron Australia. These sales do not come to pass easily. I also congratulate our counterparts in the WA government for the work that they have done. I also place on record my appreciation for the efforts which have been made by the federal Minister for Resources and Energy, Martin Ferguson, and the federal Minister for Trade, Simon Crean.

The key thing from this project, though, apart from it being a real shot in the arm for the national economy, is for us again to learn the lessons of the past, to do better when it comes to the proper planning and provision of infrastructure and skills to deal with this potentially huge expansion in Australia’s resource industry. I have made two specific announcements in this respect today. There is more to be done, but the government is up for the task of working with industry, the WA state government and other state governments to make sure that we properly support these projects into the future.