Ian Macfarlane (Groom, Liberal Party, Shadow Minister for Trade) Share this | Hansard source

Madam Deputy Speaker, of course I am happy to do that. The petroleum industry is, of course, an industry that needs to know exactly where it is both in a geophysical sense and also in a political sense. I will talk on both. This bill, which is a political instrument—that is, it comes through this parliament—will enable the industry to have a small amount of certainty that where it is drilling for oil and gas is actually where it is legally allowed to, within its own confines.

But, as I have said, we need to ensure that the industry has certainty on all fronts. You do not deliver the industry certainty by just making sure that the latest scientific technology in terms of global positioning ensures that these industries are in the right spot. You need to ensure that they have economic certainty, you need to ensure that they have legislative certainty and you need to ensure in fact that there is a suite of certainty, because this is an industry that has to invest billions and billions of dollars. In fact, in one project alone as much as $30 billion can be invested.

This bill is incredibly important—I do not understate that—but so too is the fact that, along with the uncertainty brought about by the proposed carbon trading scheme to be introduced by the Rudd Labor government, individual companies and groups of companies involved in the petroleum industry covered by this act are also being subjected to some incredible changes in the terms and conditions under which they operate in Australia. In operating in Australia, one thing that companies do want is certainty—and this bill gives some certainty. But they also want certainty when they do a deal with the government and negotiate the relationship between the government, the company and the royalties they pay. There needs to be certainty there.

Of course, we saw in the last budget an unbelievable act that will no doubt affect the sovereign risk and the certainty that these companies operate under, and that is the imposition of an extra $2.5 billion in tax on a group of companies that to date, according even to the department when they appeared before the Senate hearing in 2005, have received no benefit or exemption, in relative terms, in the current excise arrangements. That is, had they been taxed under the current arrangements, the petroleum resource rent tax, they would have in fact paid the same as they would have paid under this so-called concession. The Rudd Labor government now sees that as being too generous and is imposing an extra $2½ billion in taxes for no reason other than this government is a high-taxing, high-spending government.

Certainty is an incredibly important thing, and by doing that the Rudd government has destroyed a major chunk of certainty, far greater than the certainty that this bill creates. Important though this bill is, important though geophysical positioning is, a suite of certainties is required, and on a score of one to 10 the Rudd Labor government is running at about two, I reckon. There is not much more you can do to the resource industry in Australia at the moment except take away the certainty of their leaseholds, to completely destroy the confidence they have in investing in Australia.

Madam Deputy Speaker, I know you want me to be relevant to the bill, so I will move on to something that is very relevant to this bill—that is, what happens when someone is able to position themselves in an exact position, seek oil and gas and perhaps exploit that resource at a later date. There is no better example of that outcome than the North West Shelf for the enormous contribution it has made to Australia in the investment that has been made and the wealth it will bring to Australians, not only to those who work in that industry but, as I am sure the Rudd government understands, to mums and dads who own shares in the many companies that operate in that North West Shelf precinct.

By way of example, the latest train to be operated in that North West Shelf consortium is Train 5, and it was announced just the other day that it is moving into production. The fifth onshore LNG train is located with the other four on the North West Shelf, and I am sure the Minister for Resources and Energy has taken the opportunity to look over it, as I know he is an excellent Minister for Resources and Energy. His predecessor also took the opportunity to go there—perhaps not to my wife’s pleasure, because it was three days before Christmas, but I thought: ‘Hey, it’s the festive season. What better could you do than look at a fine example of Australian engineering!’

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