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

This is a serious matter for Western Australia, and therefore it is a serious matter for all Australians. The shutdown of the Apache Energy natural gas facility at Varanus Island in WA continues to have a significant impact on the supply of natural gas to WA consumers and to business. The Varanus Island facility supplies about 30 per cent of all WA’s natural gas needs. The latest advice I have is that the facility may be out for a number of months. This has the potential to affect the livelihoods of individuals—many workers—as well as businesses.

I think that people in the east have not quite caught up with the severity of the impact which this is having across the WA economy. It is huge. Several WA mining and industrial companies, including exporters, have been forced to scale back production because of cuts to gas supplies. Clearly it is important that we work closely with the WA government to assist in managing the impact of this on individuals directly affected by the gas outage, as well as communities.

If there is a significant impact on WA economic activity, on growth and on exports from that state, given WA’s crucial significance to the overall performance of the Australian economy, there will be wash-through for us all on this over time, but in WA right now it is being felt directly. I spoke with the WA Premier, Alan Carpenter, earlier today to discuss the situation. The Premier has established a gas supply coordination group involving some Commonwealth government agencies, and we believe that that is an appropriate reflection of the level of coordination between the two governments. The group also includes a number of key state government agencies and peak industry bodies such as the Chamber of Commerce and Industry Western Australia, the Chamber of Minerals and Energy of Western Australia, the Western Australian Meat Industry Authority and the Western Australian Local Government Association. The gas supply coordination group, which is headed by the Director-General of the Western Australian Department of the Premier and Cabinet, has been asked to focus on a range of supply challenges—including industry concerns that gas shortages will result in shutdowns and business closures, potential job losses, the effect on essential services including food supplies and hospitals and insurance challenges—as well as the overall effect on future economic growth and the mining industry.

The Commonwealth will continue to work with the Western Australian state government on the impact across the economy. The Minister for Defence agreed, on Friday last, to surrender an order of six megalitres of diesel for the Royal Australian Navy, which allowed the BP refinery at Kwinana to concentrate on bolstering diesel supplies for Western Australian industry over the coming week. The defence minister has also advised that, if a need arises for additional diesel supplies to be made available, he will consider releasing volumes from the strategic reserve. We will also invoke the provisions of the Liquid Fuel Emergency Act if required. This act provides the Australian government with the authority to prepare for and manage a national liquid fuel supply emergency. During such a situation, the Minister for Resources and Energy can control the production, transfer and stock levels of crude and liquid fuel. We are engaged with the WA government as to the need for this course of action, and at present we are advised by the Premier that action involving the invocation of that act is not required at this time.

I have also had discussions with the Premier, Alan Carpenter, about the impact of this gas crisis in Western Australia on individuals and local communities. The Deputy Prime Minister and Acting Prime Minister announced last week that the government had made available JobSearch support through Centrelink for those who may be directly affected as a result of the rupture. Furthermore, the government will maintain close contact with the Western Australian government as it undertakes its own needs analysis of what the impact will be for individuals who lose their jobs and the roll-on impact for families and for community organisations. We stand ready to assist the Western Australian government in dealing with this huge impact, which will flow down to the individual level. Once that needs assessment is concluded, both the Premier of Western Australia and I will make further announcements about further assistance which may be necessary from the Commonwealth government.

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