Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

As I indicated in the second reading debate, the coalition will support this bill, although I have been a little perplexed by the government's rapid backflip on these issues. As I said earlier, it's great to see the Labor Party come back to planet Earth after a journey through the green universe chasing hydrogen, batteries and all sorts of other madcap schemes that we're throwing billions of taxpayer dollars at to no effect, so it's great to see them come back and say, 'We want to invest in liquid fuels, and we'd like to try and secure our nation's energy needs,' on the eve of the worst energy crisis, perhaps, since the 1970s. The question I have, though, is about how committed this government is to that because, while these changes to support fossil fuels are welcome in this bill, it still retains a panoply of prohibitions and restrictions across various acts to support fossil fuels that the government itself has introduced in the past few years. It can't sit there and say, somehow, it's not the author of the problems we're about to face when it did the very thing over the past few years that it's now trying to unwind. It, in the last few years, did introduce a variety of restrictions and prohibitions on fossil fuels. In fact, it's demonised the industry. It really has demonised coal, oil and gas. People who work in that industry feel belittled, often, by the Labor Party's constant talking down. They talk about coal-fired power stations as if they're old and ageing, even though the hardworking men and women in those stations are what keeps the lights on tonight in this building and keeps our electric cars charged. I know the minister across the table doesn't share all these views, but unfortunately he's been tied to a government that does, and it's implemented that through changes in our laws.

The first question I have of the government is: despite this conversion—despite this Damascus-style awakening from this government on fossil fuels—does the government still support the Belem declaration on the transition away from fossil fuels? Just four months ago, in late November last year, the energy minister, Minister Bowen, who is now spruiking the benefits and needs to import liquid fossil fuels, was over there. I think he visited Belem. I don't know. Is that where he was? It was at COP30. Yes, Belem. I think that was the one where they carved out half the Amazonian forest to carve out a road to the climate change conference. He was over there in Belem, and he signed this agreement, which was for a 'just, orderly and equitable' transition away from fuels. That was just four months ago, and here we are passing special legislation to bring them in by the billions. Just four months ago, the government said, 'No, we don't need them; we want to walk away from them.'

This agreement went on to say that these governments, including Australia's, supported the call to advance a road map for the transition away from fossil fuels. Australia signed the agreement, along with other countries including Austria, Belgium Cambodia, Chile, Colombia, Costa Rica, Denmark, Fiji, Finland, Ireland, Jamaica, Kenya, Luxembourg, the Marshall Islands, Mexico, Micronesia, Nepal, the Netherlands, Panama, Spain, Slovenia, Vanuatu and Tuvalu. I don't see any of our major trading partners on that list. There are 24 countries, making up less than 10 per cent of world GDP. They include none of the Middle East countries that we're so reliant on for our liquid fuels and our fertiliser. Indeed, yes, I'm right. I remember doing this work at the time. None of these 24 signatories were among our top 15 trading partners. Why would the government sign such a ridiculous agreement to say we don't need these things just four months ago and now have to scramble around like headless chooks in this Senate trying to fix up the mess they have created by demonising this industry for the last four years?

They've run a war on fossil fuels, and that's put us in a much more vulnerable position than we need be in. We have enormous resources in this country. We should be developing them and using them. When I was resources minister in the former government, we were trying to do that. We were trying to get the Great Australian Bight, the Browse Basin and the Beetaloo Basin going. We got vilified by the Labor Party for supporting investment in the Beetaloo Basin, which is turning out to be quite prospective, may I say.

So my question to the minister is: does the government continue to support the Belem declaration on a just transition away from fossil fuels?

Don Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | Link to this | Hansard source

Yes.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

Okay. Well, that's nice and clear—clear as day. Here we are. The government now wants to subsidise the importation of fossil fuels, yet just four months ago it said, 'No, we don't need them.' This government's strategy when it comes to energy is clear as mud. One day, one minister is over at a climate conference saying that all of this stuff needs to go and we all need to transition away from it in a just way, whatever that means for the people who work in this industry. A just transition sounds so corporate, as if you're being euthanased to sleep. A just transition—great! That's what the government's plan is. You just heard it. You just heard the minister confirm he doesn't see a future for you if you work in the coal, oil or gas industries of this country.

We now realise--unfortunately, we had to learn this lesson, and are learning this lesson, through the school of hard knocks—that we actually do need these people. They do make our world go round. They do keep the lights on for us, and every now and again perhaps we should say thank you to those hardworking men and women. As I like to say, people in those industries have to shower after work. Most of us would have had a shower before we came to work this morning. We leave this place still smelling pretty good, not really having raised a sweat today, unlike the people who work on offshore oil rigs, which is one of the most dangerous jobs on planet Earth and is very, very hard work in confined circumstances. They deserve all the pay they get. They get paid well. They deserve it all, but they don't get thankyous very much—not from this place. They don't get any sort of gratitude from the modern Labor Party, and it's very sad. As you just heard, the modern Labor Party does want to end their jobs and wants a just transition for them to—I don't know—some kind of barista or retail work. I think those men and women are pretty happy out on the rigs.

The answer that the government has just provided does raise another question here. Just last week, the government signed an Australia-EU free trade deal. The minister knows this deal very well, of course, being also the shadow trade minister. In that deal, the government signed—

Don Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | Link to this | Hansard source

I am the trade minister.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

Yes; you're also the investment minister and the tourism minister as well. I realise that, Minister. I hope the minister knows very well what he's signed. The government released a text tonight, I think. I haven't had a chance to look at that. But the government did release a number of fact sheets last week, including one on environment and climate. In that fact sheet, they mention that the government will cooperate with the European Union on ending what is called inefficient fossil fuel subsidies.

It seems a little bit incongruous that just a week ago the government was cuddling up to the European Union, saying: 'We won't subsidise fossil fuel production anymore. We have no need for that.' Last week, when the European Union president was here, it was all about clean energy and this wonderful future of renewable energy that we keep getting promised that will sometime arrive. But then, just a week later, the government is introducing emergency legislation to—guess what?—subsidise the importation of fossil fuels, not from here but from other countries. So what is it? Is the government Arthur or Martha when it comes to the production of fossil fuels? Do they support the production of fossil fuels, or are they lining up with the European Union to say that we shouldn't support it at all?

I'm struggling to work this out. I'm sure that those who do work hard in the oil and gas industries are struggling to understand whether they have the support of the government or not. In one week, the government sign an international agreement saying: 'We're not going to support you. We're going to end support for you.' We just heard that they government are going to 'just transition' away from you. But then, the very next week, they're rushing in emergency legislation to do the exact opposite. So the question for the minister now is this: does the minister remain committed to the agreement that was signed with the European Union to end fossil fuel subsidies? If so, how does that provide any certainty to those that would seek to use this legislation to bring in fossil fuels to the country? If you're committed to not supporting them, how can they trust you to support them with long-term contracts which reduce the risk to them in importing fossil fuels?

Don Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | Link to this | Hansard source

Yes, the government remains committed to everything that we have agreed to in the new European Union-Australia free trade agreement.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

Again, this provides zero clarity to people. The minister can't even explain the incongruity. There's a clear inconsistency here with the government's approaches from one week to the next. They can't stay on an agenda here.

I might return to some of the other specific changes that have been made in recent years here. As I mentioned earlier in my speech on the second reading and, I think, earlier in the committee stage, we do know what the government, the Labor Party, did last summer. We're not silly. We didn't come down in the last shower. Just last year, the government made a number of changes to this very piece of legislation we're amending tonight, the Export Finance and Insurance Corporation Act. The government made changes to the statement of expectations of Export Finance Australia, which did severely restrict EFA from supporting fossil fuel production. Again, it seems a bit strange that just a year ago the government sought to prohibit, cancel or otherwise restrict investment in fossil fuels and then, just a year later, have to turn around and try to unwind the unwise amendments they made.

In particular, the government in its Future Made in Australia (Omnibus Amendments) Bill did change this act, the Export Finance and Insurance Corporation Act, to insert what is known as section 23C. I'll just read out the title of this section the government put in, which is pretty plain. It says 'Approval required before providing services or products to finance certain coal, crude oil or natural gas activities'. It goes on to say that finance cannot be provided under this part. I'll just read out one of these, which is quite broad. Under subsection (c), anything that directly finances 'investments for the sole purpose of the use of coal, crude oil or natural gas' is restricted. We know from Senate estimates that this can include anything, even just supplying products to an oil industry. Somebody might produce valves or something. If they supplied to the oil industry, because often they're needing a lot of valves, they can't get finance from EFA anymore under the provision, at least under the commercial account.

What the government seems to be relying on here, from my understanding from the briefings they've given us—I should say thank you to the government for briefing us on this. As I said, we will facilitate this passage, but there's a broader important point to make about the long-term energy security of this country, whatever happens in the next few weeks. The government here has effectively restricted EFA—this is my understanding—from using what's called its commercial account to finance pretty much anything that involves the coal, oil or gas supply chain. But it's relying now on the National Interest Account to potentially make these investments to scramble around and get whatever boats we can to come into the country because we no longer produce much oil ourselves anymore.

My question here, Minister, is why aren't you—is my understanding right here that these new arrangements to fill the strategic reserve can only be made from the National Interest Account? Secondly, does that National Interest Account require ministerial approval for every contract entered into? That's my reading of this act. It's a bit clumsy that the EFA has to go to the minister every time to seek approval. It doesn't really have the flexibility here, in a fast-moving environment, to act quickly. Thirdly, why hasn't the government sought to simply take off the green handcuffs from EFA and remove section 23C, which has only been there for a year. That would at least allow it to use this commercial account, which, in my understanding, doesn't need ministerial approval every time. We could more flexibly respond to this huge crisis.

Our view here on this side is that we want to help you. We want the elected government of this country to have the unfettered ability to solve this crisis to secure liquid fuels for our country. We don't want a minister of the Crown to have these green handcuffs placed on them that would otherwise in any way inhibit the ability to solve this crisis. As I say, we are trying to cooperate here. Again, I appreciate the briefings. I will be moving an amendment later which would help you. It'd give you more power. We're looking to give you, the Labor government, more power because what we need now is quick action and quick decisions to keep this country moving. Minister, is this only available in the National Interest Account, and have you consider removing this so you can just use everything in your power to get things done?

Don Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | Link to this | Hansard source

I thank Senator Canavan for his question. We believe the EFA has the right mix of powers to support our fuel supply through these amendments. The National Interest Account is the best way to ensure this fuel gets to where it's needed, particularly to Australia's regions, and it helps importers secure spot cargos that would otherwise be uncommercial. In doing so, it gives the nation more secure supply quickly.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

That's a description of what the bill does. I can read the documents for that. It doesn't really answer the question of why the government hasn't considered jettisoning all of this green rubbish they've inserted into legislation because they felt under pressure from the Greens. Minister, I think you've got more flexibility than you realise. There's a poll there that came out on Sunday which found that now, amazingly, 40 per cent of Greens voters support drilling for oil and gas right now. If the law of averages holds, that means that, of the ten Greens senators down there, four of them probably support drilling for oil and gas now. If they only came and joined us all, we would not have a problem. Liquid gold would be flowing like a river.

I'm not sure why the government is reluctant now to jettison—I can see why, in the last few years, in the current climate, there's been this well-funded—often, overseas funded—activist campaign to denigrate the great Australian resources industry. I've tried to stand up against that. I haven't buckled to this pressure, but you have. The Labor Party did. But you don't need to anymore, because the Australian people can see the common sense of needing to drill for oil and gas. We cannot be so dependent, relying on other countries.

There was a great report released just the other day by the Page Research Centre, which is the National Party's think tank. This stat just blows my mind. I hadn't seen it before, but it checks out. A full 50 per cent of the imports to this nation by weight are liquid fuels. Half of our nation's imports by volume are liquid fuels, and another 10 per cent by weight are petrochemicals, so 60-odd per cent of the imports to our nation by weight come from petrochemicals. That is clearly a massive energy security vulnerability and national security vulnerability for our country because any nation that would seek to do us harm has got the Achilles heel right there.

This is no secret. This is all publicly available data. Anyone can work this out. We just haven't thought about hard enough, really—and I haven't either. I just couldn't believe this. I hadn't seen it before. All they'd need to do is cut those shipping lanes. We would really struggle, obviously, to defend so many ships coming to our nation, and we'd be brought to our knees—just as we are right now. It clearly is a massive security priority for Australia to reduce our dependence on liquid fuels. The government's line to date has been: 'Well, the refineries closed on your watch. We don't have the 90 days of stockpiles.' But that almost begs the question: if we did have the refineries—and let's get it right. Angus Taylor saved the last two refineries. They were going to shut, but we supported them to stay open.

Even if we had kept the other four open, we'd be in the same boat, because we would rely more on imports of crude oil to fuel those refineries. We're literally in the same boat—excuse the pun. We still need the boats to arrive to keep those refineries moving, and what's happening right now? The boats aren't arriving. The Strait of Hormuz is closed. We'd have exactly the same vulnerability even if we had the six refineries going. Clearly—and this is what this report plays out and concludes so succinctly and clearly—the problem is that we don't produce the raw feedstock. That's what we need to reduce our vulnerability. Unless we can have an oil industry from go to whoa—from rig to petrol pump—and have that supply chain here domestically, we remain vulnerable. Our Achilles heel that an adversary can target remains.

The problem has been that we haven't explored enough oil and gas. We have, under this government in particular, demonised and prohibited any kind of support for this industry. My question to the government here is: do these changes allow EFA to invest in domestic oil production, be it conventional—or unconventional—drilling for oil and gas or some other technologies like coal to liquids. This report really plays that out. South Africa gets 40 per cent of its liquid fuels from coal to liquids. China's burning 400 million tonnes of coal a year to make liquid fuels. We can do this. We've got enormous coal reserves. Do these legislative changes allow EFA to invest in those kinds of technologies, which would fundamentally change our energy security and reduce our vulnerability of relying on other countries?

Don Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | Link to this | Hansard source

The bill does what it says it does. It allows EFA to purchase oil on the spot market to quickly ensure that we have sufficient petrol, diesel and airline fuel. I think Senator Canavan does not accurately reflect the approach that the Australian government has taken to this industry. I make the observation that the Barossa project in the Northern Territory, offshore, has gone ahead under this government and has started producing gas out of the wells. Similarly, with the Beetaloo, the first production of gas in the Beetaloo is already flowing. One day we might get gas supplies out of Narrabri, one of Santos's projects.

The reason there's no oil exploration in the Great Australian Bight is a series of companies which had exploration rights and discovered oil in the Great Australian Bight made commercial decisions that it wasn't economic to proceed. If you look at decisions that Chevron made, they had licences down there. I think Exxon was down there at one stage. I think the Norwegian state oil company—

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

Equinor.

Don Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | Link to this | Hansard source

Equinor—thank you, Senator Canavan—was the last one to pick up drilling licences from, I think, Chevron and Exxon. They simply made a decision that it wasn't economic to proceed with those explorations. They weren't government decisions. The state government and, to the best of my knowledge, the federal government had given those companies all the approvals they needed, but they made decisions, based on their own economic interests, not to proceed.

As I say, Barossa is now producing gas. Beetaloo is producing gas. I was recently at Santos's operations in the Cooper Basin; I think they're continuing to produce gas and, to the best of my knowledge, they are expanding their gas operations. In Western Australia we continue to produce significant amounts of gas. So I don't think Senator Canavan's characterisation of the Australian government's position is at all accurate.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

I thank the minister. That was some useful information there; I recognise that. I'm trying to help the trade minister here, because I know he wants to drill, baby, drill; he'd love to do it! He'd love nothing more than to get out on an oil rig and see that liquid gold flow, but I realise he's a little constrained in his current environment. I wish him well in his efforts; I hope he can convince his Labor colleagues to get on with it.

It's a little rich to be taking credit for the Barossa project, though, when this government has funded the Environmental Defenders Office, who held that project up for years; thankfully, their deceit was exposed by a judge in a court case which completely blew up their credibility and allowed the project to continue. But that was no doing of this government; they in fact helped frustrate those efforts through that funding.

The other point to make here is that, while the minister is correct about the public statements of Equinor and BP—and I was heavily involved with them in seeking to keep them here—there is no doubt that the ridiculous activist pressure of the time played a role. We had the absurd situation where the ABC were publishing stories claiming that an oil spill in the Great Australian Bight would wash up on Bondi Beach and cause all types of terrible catastrophes; it was absolutely absurd. Now the ABC has had the temerity, when they interviewed me, to try and blame me for the situation we are now in with oil. I'm not going to cop lectures from the likes of the ABC, who for years have run an activist campaign against the production of more fossil fuels.

While some of those developments the minister has mentioned are welcome, he, a number of times, revealed the issue that most of those projects—Narrabri, Barossa, Beetaloo to a certain extent—are gas focused. There are some condensates in some of those projects. But the fundamental problem we have is that those types of oils, condensates, are good at producing the lighter carbon strings, like petrol and naphtha. They aren't so good at producing diesel, the heavier distillates and jet fuel. The situation our economy faces today is that diesel use is double that of petrol, which is the reverse of 50 years ago. That's why we're in this pickle at the moment. Unfortunately, as a country, we don't have a lot of heavy crude production that can easily be made into those types of liquid fuels, hence the government having to introduce this legislation to try to support the importation of those heavier crudes from overseas.

This is the key inconsistency with this bill and approach. I asked the government if, after these changes, Export Finances Australia can support the Australian production of oil and gas. The answer is that it can't. The minister didn't quite say that; he couldn't bring himself to. But it can't. The government hasn't unwound those changes. The Australia government's current position is that it's okay to subsidise the production of oil and gas in other countries but not our own. That's their position. If you subsidise the importation of oil and gas from another country, you are by effect and by design subsidising the production of oil and gas in another country. It's got to start somewhere. Part of the cost to Russia, the USA or the Middle East sending us their oil and gas products is the shipping of those products to here and the potential risks they face, including price risks and this government hedging risks which seeking to reduce through this bill.

Let's get this very, very clear. We support this approach because it's a desperate situation. Desperate times call for desperate measures. This is a desperate measure, because the Australian government is using the hardworking taxes of the Australian people to subsidise the production of oil and gas in another country. Yet it won't turn around and support Australian production, the use of Australian resources and the creation of Australian jobs. This desperate bill is needed right now, but it supports jobs and industry overseas, ahead of Australia. We've just seen and summed up this government's approach to our national development and our country. They're more than happy to come in here and support other nations. Yet, when it comes to supporting and backing Australia and our resources, potential and future, they're nowhere to be seen. They're off with their Greens mates, and they won't support Australian industry or jobs.

Don Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | Link to this | Hansard source

I completely reject Senator Canavan's characterisation.

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

Minister, from the start, One Nation has completely opposed the United Nations net zero scam. Only One Nation has said from the start and continues to say, 'Scrap United Nations's net zero.' The Nationals say, 'Scrap net zero by 2050.' They support the net zero concept but want to delay implementation. The Liberals say the same. They still support UN's net zero; they just want to drop net zero by 2050. The Liberals started net zero under Prime Minister Morrison after he'd promised at the election just 18 months earlier not to adopt it. The Nationals went along with it blindly. The Labor Party has adopted One Nation suggestions—

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

Barnaby did!

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

He now realises he was wrong, and he's probably said so, to his credit. That shows his integrity and courage. Labor has adopted One Nation's suggestions. We were the first to raise the looming fuel crisis back on Monday 2 March, three days after the Israelis attacked Iran. We were ridiculed for that—called far-right-wing extremists, I think—by the Labor Party. I can distinctly visualise Senator Tim Ayres over there saying that as he pointed towards me. It doesn't bother us, because we know that he was desperate. But we thank you for adopting so many of our policies over that last four weeks, and you're still adopting them. Thank you. Will you adopt our advice to scrap UN net zero? Will you at least acknowledge that the hydrocarbon fuels coal, oil and natural gas are essential for modern civilisation—in particular, oil for transport? Will you acknowledge that we need to be self-sufficient in the entire hydrocarbon supply chain, from drilling rig through to petrol pump?

Don Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | Link to this | Hansard source

I thank Senator Roberts for his question. I should congratulate you on your result in the South Australian elections, Senator Roberts. I know you came down and campaigned, certainly in the seat of Colton. I saw you down there with your candidate.

I have an apology to make to Senator Canavan. When I was answering one of his questions last week, I referred to the fact that, in his first outing as leader of the National Party, where he was going to take on One Nation, your candidates got 22 per cent of the vote, and I said in the Senate that the Nationals had got one per cent. I have to apologise to Senator Canavan; that was not correct. It was 0.7 of one per cent, not one per cent. So, in his first outing as leader, espousing all of the policy positions he's just explained to this Senate, that was the result.

We do produce gas in this country, Senator Roberts, and we've produced it under this government. I've referred, in an earlier answer to Senator Canavan, to some of the places where we're doing it. We're doing it in the Barossa. We're doing it in the Beetaloo. One day we might do it in Narrabri. We're certainly increasing production in the Cooper Basin in South Australia. But we do have a commitment to net zero. That is, as you say, a commitment that both the Nationals and the coalition, at certain periods of time, have been committed to. Gas, in particular, is a transition fuel, Senator Roberts. It's the way in which you get to net zero.

But right now we have an emergency. We need to ensure that our stocks of petrol, diesel and airline fuel continue to be available to businesses and consumers in this country. There is an emergency about dealing with this. What happens on the sea is that there are ships containing oil, petrol and airline fuel. They become available for purchase, and sometimes you're only given 24 or 48 hours to make that purchase. The reason we have decided to use the facility of Export Finance Australia to bid for these products is that they're a very nimble organisation, they're very experienced in this space, they are run really well by a fellow called John Hopkins, they regularly report to me, and we see them as the best organisation to ensure that we act quickly on this.

Minister Bowen has ensured that, in combination with me and Minister King, we have taken all of the steps that we need to take to ensure that Australians continue to have access to all of those fuels that I just mentioned. But there is an urgency about this legislation. Despite everything Senator Canavan said, I'm not sure that he appreciates that urgency. We do need to get on with this, and the quicker we pass this legislation, the quicker we can get some certainty to businesses and consumers about the reliable supply of those fuels.

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

Minister, will you support One Nation's initiative in recommending the conversion of gas to liquid fuels? You mentioned gas.

Paul Scarr (Queensland, Liberal Party) Share this | Link to this | Hansard source

I'm sorry, Minister, but, pursuant to the order agreed to yesterday, the time allotted on this bill has expired.