Tuesday, 12 May 2020
Offshore Petroleum and Greenhouse Gas Storage Amendment (Cross-boundary Greenhouse Gas Titles and Other Measures) Bill 2019, Offshore Petroleum and Greenhouse Gas Storage (Regulatory Levies) Amendment (Miscellaneous Measures) Bill 2019; Second Reading
That's all well and good for Victorians, and I'm not going to get in the way of that—that's for sure. I just want to ask why no hydrogen projects in Tasmania are getting the same special treatment from the federal government that they seem to be getting in Victoria. I think it's a fair ask. It's not like we don't have an appetite for this stuff in my own state. I can tell you that there are Tasmanian investors and investors from outside Tasmania who are champing at the bit to be able to build up our hydrogen industry in Tasmania. The state government wants it as well. We are ready and set to go. There are shovel-ready projects that are so close to getting off the ground. The plans are there. The finance is there. It's not that far off. And we can taste it. We just need a little push to get it going—just like what Victorians are getting here. And good for them. Like I said, I'm not getting in their way, I don't want to tread on their toes. But, frankly, I think Tassie would be a better investment and I think there is enough money to go around for everyone. Our hydrogen industry wouldn't have to be stuffing around with these expensive carbon capture projects to make it happen. Instead, we are perfectly placed to use renewable energy to make proper green hydrogen. It would be cheap to produce and it would bring thousands of jobs to my neck of the woods. I can tell you, after being the epicentre of COVID-19, we are going to need those jobs to get back on our feet. It would also help stabilise our energy market so we don't have the threat of massive price hikes on our electricity bills if a big industrial player pulls out.
Honestly, it would be win-win for everyone, so I just don't see why we've been overlooked on this. Maybe this is just another case of Tasmania being left off the map. Well, I'm putting us back in the spotlight because Tasmanian green hydrogen could be a huge opportunity for the country and also for my state. I invite the federal government to get on board.
I rise to speak on the Offshore Petroleum and Greenhouse Gas Storage Amendment (Cross-boundary Greenhouse Gas Titles and Other Measures) Bill 2019 and the Offshore Petroleum and Greenhouse Gas Storage (Regulatory Levies) Amendment (Miscellaneous Measures) Bill 2019. It's a very opportune time to be speaking about this bill, given the veritable stampede we are seeing in this country to open up new exploration acreage to fossil fuel companies. It is a veritable stampede going on as we speak right here now.
The purpose of these bills—dealing with the first one, the Offshore Petroleum and Greenhouse Gas Storage Amendment (Cross-boundary Greenhouse Gas Titles and Other Measures) Bill 2019—is to amend the Offshore Petroleum and Greenhouse Gas Storage Act 2006 to provide for single greenhouse gas titles that are partially located in Commonwealth waters and partially located in state and Northern Territory coastal waters, and to strengthen and clarify the monitoring, inspection and enforcement powers of National Offshore Petroleum Safety and Environmental Management Authority, commonly known as NOPSEMA, during an oil pollution emergency originating in Commonwealth waters. The purpose of the second bill is to amend the Offshore Petroleum and Greenhouse Gas Storage (Regulatory Levies) Act 2003 to clarify the application of levies in relation to cross-boundary greenhouse gas titles.
I don't believe in coincidences in politics, but we've just been through a summer in this country of the most devastating bushfires. We've seen the Great Barrier Reef bleach for the third time in five years—the worst mass coral bleaching on record. We've seen every temperature record in this country broken, a record drought and a broad recognition around the country that we are in a climate emergency and we need to take action. It's counter-intuitive that, contrary to what most people would expect—that this government would be taking real action on climate change and reining in the profit interests of the fossil fuel industry—the exact opposite is happening. The exact opposite is happening.
Exploration acreage has been released right around this country, both onshore and offshore, and we have seen state and federal governments and the regulator relaxing measures during this COVID crisis, during this pandemic, to enable the oil and gas industry to get out there and explore for more oil and gas. It's almost like they are sniffing the wind. Their social licence is running out of time and they're getting as much as done as they can, as quickly as possible.
Let's talk about what's happened since we've had a pandemic in this country. Why would one particular industry, the gas industry, be receiving such favourable treatment at such a time? For a start, on 23 March we had Premier Daniel Andrews in Victoria shock the Victorian public and climate change activists by lifting the ban or moratorium on conventional gas development in his state—something he made an election promise that he wouldn't do. We've seen Santos ramping up their endeavours around coal seam gas in Narrabri in New South Wales and a big campaign rallying against that.
We've seen, on 17 April, just recently, resources minister Keith Pitt put out his media statement 'Flexibility for offshore explorers during COVID-19 crisis'. Yes, that's right; he's put in place a specific policy for this industry during COVID. He acknowledged the impact COVID has had on the sector and the greater need to make it easier or more flexible for explorers. At the same time, he opened up 49 new areas for offshore petroleum acreage, the majority of it off the north-west coast of Western Australia, but some of it also in the Great Australian Bight and in Bass Strait. New areas are being issued in WA, Northern Territory, Victoria and the Ashmore and Cartier Islands.
We've also seen—I had a very quick glance at NOPSEMA's website, and this was retrieved just yesterday—21 new applications, including three seismic survey applications, six applications for drilling and two applications for a petroleum pipeline, just this week approved. We've seen over 100 recent approvals—I've gone back over recent months—for new seismic testing. I recently spoke to some Tasmanian fishermen, who Senator Colbeck in this chamber would know quite well, who were devastated when they heard that Beach Energy were applying for, and had just received, permission from NOPSEMA to do seismic testing in Bass Strait, in one of their productive scallop beds. Ten years ago, the scallop industry clearly blamed seismic testing for the loss of an entire scallop bed and $50 million worth of exports. Yet it is still happening. Why is there such a stampede? As I said, I don't believe in coincidences in politics.
We've also seen, today, announcements by the Western Australian government of a new Pilbara LNG fuelling hub, offering 50 per cent discounts for LNG vessels to use this facility to attract more large fossil fuel ships. We've seen a very disappointing decision by the EPA in Western Australia around the regulator taking a hands-off approach to Yarra's emissions up in the north-west. Senator Smith, who is in this chamber, was part of the Senate inquiry which I chaired that looked at the Aboriginal rock art in Western Australia. As a boy, I grew up playing around that rock art. We know that the area should be declared a world heritage area, yet here it is: the EPA have just given them a licence, with no restriction on their near million tonnes of emissions into an area that is so precious and globally recognised as one of the biggest natural art galleries on the planet. To a lot of people, it just doesn't make sense that the government is giving even more favours to the big end of town, to big polluters. I'd like to talk about why that may be the case. As I said before, I don't believe in coincidences in politics.
Right now in this country we have a COVID commission looking at many things, including an economic recovery task force. We've seen some very strong statements from Australia's Minister for Energy and Emissions Reduction, Mr Angus Taylor, from the other place, who has openly suggested that the recovery from the COVID-19 crisis will be 'gas fired'—a gas-fired recovery, a fossil fuel recovery in Australia. That's right; our minister for emissions reduction is advocating for more emissions. Also, if you believe the media reports, many of the people appointed to the National COVID-19 Coordination Commission, the NCCC—and I'll get to that detail in a second—represent fossil fuel interests. And, if you look at the manufacturing task force that they have appointed, you see it's totally stacked with fossil fuel interests, gas lobbyists and climate deniers.
So on one hand we have all these new areas being opened up for fossil fuel, especially gas exploration, and on the other hand we have a task force, hand-picked by the government, that is going to make recommendations direct to the Prime Minister and cabinet about how we can pull ourselves out of this COVID downturn. It's clearly set up with the cards stacked in favour of the fossil fuel industry—the ducks are lined up—and no doubt the government will act on the recommendation of this task force for more gas development in Australia, both onshore and offshore. I understand the Senate Select Committee on COVID-19, for which Senator Siewert is the Greens' representative, is hoping to call the CEO of the National COVID-19 Coordination Commission, Nev Power, to talk more about the processes around the recommendations to government.
I want to put on record and acknowledge the excellent sleuthing by a media outlet called Medium and Dan Gocher, who managed to pull together some of the detail around the people who have been appointed to this commission. He notes that Nev Power is known as being a bit of a doer in circles, having worked with Twiggy Forrest's Fortescue Metals Group in getting that up and running as a global powerhouse. Both he and Mr Forrest also have interests in gas exploration companies. I understand that Nev Power, having retired from Fortescue Metals Group in 2018, is now a non-executive director of Strike Energy, which is planning to develop gas reserves in the Perth Basin in Western Australia.
Also on that national coordination commission is Energy Australia CEO Catherine Tanner. Energy Australia owns two coal-fired power stations—Mt Piper, in New South Wales, and Yallourn, in Victoria—and is Australia's second-largest carbon polluter, emitting 22 million tonnes of CO2 in 2018. The CEO, Catherine Tanner, also sits on the board of the Business Council of Australia. No doubt this is part of the game of mates that this government has set up to facilitate the gas-led recovery that Minister Taylor has been so open about.
But let's have a closer look at the less-than-face-value manufacturing task force which is led by former Dow Chemicals boss Andrew Liveris. While he is a director of IBM, ASX-listed Worley and NOVONIX, he's also on the board of Saudi Aramco—yes, Saudi Aramco—and 'has long advocated for natural gas as a silver bullet for Australia's energy woes'. That was reported in the article in Medium. He is joined on this task force by AiGroup CEO Innes Willox; Manufacturing Australia CEO Ben Eade; and Manufacturing Australia chair, former Incitec Pivot CEO and current director of APA Group James Fazzino.
According to Medium, Innes Willox has a long history of opposing climate policy in Australia. Clive Hamilton named Willox as one of his so-called 'dirty dozen' in 2014—the 12 Australians most responsible for blocking climate action. The AiGroup, whose members include AGL Energy, Bluescope Steel, Boral and Woolworths, campaigned against the carbon price openly in 2012-14 and support the development of new thermal coalmines in the Galilee Basin. They've also lobbied against a moratorium on onshore gas developments. UK-based NGO InfluenceMap ranked AiGroup among the most highly climate-oppositional industry associations in the world.
Similarly, Manufacturing Australia has routinely opposed and campaigned against climate action. Most notably, Manufacturing Australia opposed the closure of the Liddell coal-fired power station and supported Alinta Energy's bid to acquire the clunker from AGL in order to keep it open indefinitely. It has also called for a domestic gas reservation policy. Also reported by Medium, former Incitec Pivot CEO and APA group director James Fazzino is, unsurprisingly, a big fan of gas. Anyone can read that article for themselves. It goes into a lot more detail about why that is the case.
Let's have a look at the public comments that have been made. I talked about Minister Taylor, but last week the NCCC chair, Nev Power, was more explicit in his statement, saying to TheSydney Morning Herald:
We need competitive energy prices, particularly gas, to attract large-scale manufacturing like fertiliser and petrochemicals.
That was also reported in The Australianand The Guardian. He went further:
We have significant reserves of gas on the east coast that are not connected up. We have significant reserves in central Australia and significant reserves in Western Australia. There are options to connect our major demand centres with our major supply centres.
And so on and so forth.
We've seen our environment minister talk about weakening so-called green tape, and we know that the deregulation commission has been rolled into the COVID commission. What this is is a recipe for pushing more fossil fuels, at a time in history when we should be doing the exact opposite. We should be putting in a Green New Deal, investing in renewable energy, investing in our communities and fixing the planet, while providing the jobs and industries of the future—not going down this road of continuing to pollute and cook our planet. It is simply unacceptable, and the Greens will continue to expose this and continue to put up alternative options for the future of this country.
Basically, it's time to end the uncertainty, in the Great Australian Bight, in relation to oil and gas exploration. This is a bill that Centre Alliance will support, but we want to bring some certainty to the fishing industry and the tourism industry in South Australia. For decades, those industries have had to operate in the shadows of exploration, including seismic testing and the prospect of drilling in the Great Australian Bight. The uncertainty has stifled investment.
Offshore gas and oil exploration in the Great Australian Bight has occurred in three major phases: in the late 1960s and early 1970s, the early 1990s and from 2000 through to current exploration. More than 40 oil and gas exploration permits have been granted in the Great Australian Bight, and 13 exploration wells were drilled between 1972 and 2003. Since that time, only seismic testing has been conducted. We've seen BP come and go, we've seen Chevron come and go, we've seen Karoon Gas come and go and we've seen Equinor come and go.
These large companies all pulled out because, quite simply, drilling for oil in the bight is not economically viable. Meanwhile, the presence of the remaining oil companies and the ongoing prospect of drilling has adversely affected investment in the fishing and tourism industry. The fishing industry on the Eyre Peninsula alone is worth $500 million, and $400 million of that goes to export. Eyre Peninsula tourism is worth more than $300 million. Combined, both of those industries, directly and indirectly, employ some 5,000 South Australians. And these smaller industries pay tax, which is in great contrast to the oil and gas industry.
I've looked at the tax transparency data that the tax office now releases for companies that have a revenue of greater than $100 million. We can see that Chevron Australia Holdings Pty Ltd earned, over the last five tax transparency years, $15.7 billion. To the minister: do you know how much corporate tax they paid on that $15.7 billion of revenue? Absolutely zero. But if you think that's bad, let's go to ExxonMobil: $42 billion of revenue over five years and not a brass razoo paid in corporate tax. Kufpec Australia is another one: $1.2 billion of revenue; zero tax paid. Kuwait Petroleum Aviation (Australia) Pty Limited: $1.4 billion of revenue; zero tax paid. PTTEP Australia Perth: $2 billion; zero corporate tax paid. Tokyo Gas Australia: $1.7 billion; zero corporate tax paid. So we've got a contrast. We've got the tourism industry in South Australia, we've got the fishing industry in South Australia, hardworking mums and dads, varying sized companies, all paying tax, and they're unfortunately overshadowed by the oil and gas companies who are, basically, dithering around in the Great Australian Bight.
Let's look at one of those companies: Chevron. I'm grateful to the ATO. The ATO has done a fantastic job here. I'm not always complimentary of them, but they pursued Chevron. Chevron borrowed money from its corporate parent at nine per cent. Its corporate parent got it at one per cent. And they got caught out. Do you know how much the tax office got back? $866 million. That was in a lawsuit that the tax office won. Anyone who's in business knows that you have to have arm's-length transactions. You have to have proper accounting between a daughter company and a parent company. It's not rocket science. It's basic business. Yet Chevron didn't know this, somehow. I say they did, and I say that they stole from the tax office. That means they stole from the Australian public.
We've got a lot of companies running around right now looking for handouts, for help, and I don't mind giving people help. But, please, I hope none of these oil companies come to us for help, because they haven't paid any tax. They'll say, 'But we paid PRRT.' Firstly, that has been shown to be totally inadequate. We also need to understand that that is a separate tax that is provided to the Australian public because they take our oil and gas from underneath the sea.
I will be moving an amendment to this bill that will limit exploration leases in the Great Australian Bight to 10 years. Bight Petroleum is in the Great Australian Bight, as an example. They have sought and received six exploration permit extensions since 2011 for each of their permits, for both of them, EPP 41 and 42. These permit areas are close to Port Lincoln and Kangaroo Island. We're not trying to say to these companies, 'Stop immediately. You've lost your investment.' We're just saying, 'You need to commit or leave.' 'Use it or lose it' is the common term.
What these companies do is hold onto the asset, and, under the lease conditions that NOPTA impose upon them, they're not required to develop any particular resource if it's not commercially viable. But 'commercially viable' to them might mean that, in order to drill, they have to go and get an asset that's actually being used productively somewhere else, so therefore it's not commercially suitable. They use this system to just keep renewing and renewing and renewing, and we let them do that. In the meantime, that oil and gas that could have been extracted to assist us here in Australia is not extracted. In the case of the Great Australian Bight, we all recall Equinor. They would have simply extracted that oil and exported it, again without tax being paid.
So we've got to stop this. We've got to give certainty to South Australian industries, to the fisheries industry, to the tourism industry on the Eyre Peninsula, across to Victor Harbor, all the way down to Mount Gambier. We've got to give certainty so that they can make investments and know what lies ahead in terms of their future. After the vote on the second reading, I will be moving an amendment in the committee stage.
I thank senators for their contributions to this debate, which ranged far and wide in relation to a relatively narrow package of amendments to the Offshore Petroleum and Greenhouse Gas Storage Act 2006. The Offshore Petroleum and Greenhouse Gas Storage Amendment (Cross-boundary Greenhouse Gas Titles and Other Measures) Bill 2019 enables the title administration and regulation of a greenhouse gas storage formation straddling state and Commonwealth jurisdictions. This will facilitate, for example, the CarbonNet proposed project storage site, which is investigating the feasibility of a commercial-scale multiuser carbon capture and storage network in Gippsland, Victoria. This, in turn, is a crucial element of support for the Hydrogen Energy Supply Chain Pilot Project, which has attracted Commonwealth government, Victorian government and international partners and which relies on suitable CCS as part of its trial around effective hydrogen generation in that space.
The package also contains a measure to strengthen and clarify the monitoring, inspection and enforcement powers of the National Offshore Petroleum Safety and Environmental Management Authority, NOPSEMA, within state and Northern Territory jurisdictions in the unlikely event of an oil pollution emergency originating in Commonwealth waters. The amendments will enable NOPSEMA to monitor whether a titleholder is in compliance with its oil spill response obligations and take enforcement action in the event of noncompliance. They also extend the operation of polluter-pays obligations and the application of significant incident directions to areas of state and Northern Territory jurisdiction.
Acknowledging the recommendation made by the Senate Economics Legislation Committee's report on this bill, the Department of Industry, Science, Energy and Resources has advised that APPEA was consulted on an exposure draft of the bill and they raised related or similar concerns at the time. In their response, the department undertook to share and discuss those concerns with NOPSEMA to ensure that the matters were canvassed in the relevant guidance and protocols as appropriate. The APPEA's submission to the Senate committee will also be given due consideration during the development of the guidance and protocols that will follow these legislative changes. The government acknowledges the concerns expressed by APPEA but considers that the matters are more appropriately dealt with in those guidance terms rather than in legislation. The guidance and protocols will assist to ensure clarity and procedural certainty in the unlikely event that the provisions need to be activated.
I thank senators for their contributions to the debate and commend the bill, with those specific amendments to it, to the chamber.