I would like to begin by acknowledging the traditional owners of the land on which I’m joining you from, which is the Ngunnawal and Ngambri People, and I pay my respects to their elders past, present and emerging.
Thank you for the opportunity to provide a short opening statement on behalf of Australian oil and gas producers.
I will limit my remarks to the parts of the Bill that relate to the changes to the Petroleum Resource Rent Tax, the PRRT.
Industry has engaged constructively with Government over a sustained period of time to ensure the changes to the PRRT strike a balance between a more sustainable national budget and a strong and competitive gas sector.
The changes to the PRRT announced by the Treasurer last year bring to a close the Callaghan review of the PRRT that was handed to Government in April 2017, and the Treasury Review of the PRRT Gas Transfer Pricing Arrangements that was finalised in May last year.
We support the passage of the PRRT changes contained in the Bill to provide certainty to the industry and help restore investment confidence in new gas projects in Australia.
The Australian Energy Market Operator, the ACCC and other independent experts are warning that Australia faces structural gas shortfalls in the coming years without urgent investment in new gas supply. This will impact energy affordability and reliability for Australian households and businesses, the energy needs of our regional partners, and our transition to a net zero economy.
As noted in our submission, the Australian oil and gas industry has invested well over $400 billion in the Australian economy over recent decades, undertaking exploration and developing natural gas production, transport, liquefaction and export facilities to provide energy security for Australia and our regional partners.
In addition, PRRT is just one part of the significant tax our industry contributes every year to state and federal governments.
Last financial year, the industry contributed $16.2 billion in direct payments to governments through corporate income tax, PRRT, state royalties and excise.
It is essential that economic policy and regulatory settings are designed to attract and retain investment in Australia.
The Australian economy is reliant on foreign investment and the oil and gas industry is no different to any other industry in that respect.
Much of this investment has come from our key trading partners, and over the past 20 years this investment has unlocked significant volumes of gas for the domestic market.
In closing, we urge the Senate to pass this Bill in order to bring the PRRT review process to a close and provide certainty to industry.
I am happy to answer any questions the Committee has.
