Chris Hayes (Werriwa, Australian Labor Party) Share this | Hansard source

As has been indicated by previous speakers, the Offshore Petroleum Amendment (Datum) Bill 2008 is largely a technical amendment bill. I will not say a minor technical amendment, because it does actually have a significant impact on the way we let and record our offshore leases. The purpose of the bill is to make a technical amendment to the datum provisions included in the Offshore Petroleum Act 2006. It is not a policy change; it is, as has been previously indicated, a change in the way we record survey results in allocating leases in this country. The bill will correct an error resulting from a technical oversight in the Offshore Petroleum Amendment (Miscellaneous Measures) Act 2008 which inadvertently replaced all references to the Australian geodetic datum, AGD66, with the geocentric datum of Australia, AGD94. The amendments in the Offshore Petroleum Amendment (Miscellaneous Measures) Act commenced on 1 July this year.

The ‘datum’ is the way that the mathematical survey results are coordinated with the description or the title in question. The Australian geodetic datum, the AGD66, was based on the mathematical surface of the earth which was designed to fit the Australian region. Whilst this has been a good datum for local use, its origins are approximately 200 metres offset from the earth’s centre of mass. That was not an issue when we surveyed using precisely that as the reference point for issuing our leases. However, with the advent of global positioning systems, GPS, the international standard, as I understand it, is now looking at the geocentric, or the earth’s centre in terms of establishing datum points, which is the basis of the geocentric datum of Australia, the AGD94. Whilst we can actually still use that, all of our leases are calculated on the basis of the AGD66, and that is how it is divided up into contestable areas for offshore oil and gas exploration.

Under the recently repealed Petroleum (Submerged Lands) Act 1967, the graticular sections and blocks—which I understand are sections of about one minute latitude against one minute longitude—are based on and determined against the older reference, which is the AGD66. To provide certainty to the petroleum titleholders and to ensure that boundaries are not changed, what we need to do is to readmit those older survey coordinates, the AGD66, into the new act. The more accurate GPS, which is increasingly used for surveying and navigation, will also be expressed in the act, but in the allocating of titles it is to revert back to AGD66.

As I say, this is a technical bill to an extent, but it has huge ramifications. Not all that long ago I had the opportunity to revisit the North West Shelf. I used to spend a lot of time working at the North West Shelf and the Timor Sea. I know a fair bit about the competition for our offshore leases and I also know how desperate we were to find oil, particularly in the Timor Sea, to replace Bass Strait. Regrettably at that stage, and I am going back a number of years, every time we drilled for oil we found gas and for a period of time we capped a number of our wells—in fact, many of them still remain capped—as we had to move to extend our markets. We established our markets particularly from the Woodside finds, from the Rankin A platform. We certainly managed to sell a considerable amount of gas to China, Japan and now to South Korea.

This country, despite what the pundits might have you believe, is an energy rich nation. It is just that some of our resources are a little hard to obtain. At the moment on our current consumption rates we have about 110 years supply of natural gas. That includes what we are sending offshore to China, Japan and South Korea and our existing domestic market. I have a few more figures. At this stage we have about 800 years supply of brown coal and 350 years supply of black coal. I understand that there are always going to be some issues about the burning of fossil fuels, and that is why this country must become a leader in establishing clean technologies for the production of sources of energy. But we have an abundant supply of gas, and one of the things I have constantly indicated to the minister is that this country, with its abundant supply of gas, must start to work on policy that moves in the direction of gas to liquids. This is an important part of our future development and will certainly be important for future Australian industries and also the domestic market. To that extent, whilst we do have 110 years known supply of gas reserves, it is important to us to extend that industry. We need to find more gas in order to facilitate that future.

Unfortunately, when we talk about oil, our oil reserves are estimated to be depleted within the next eight years. That will have a significant and deleterious effect on our economy unless we find a suitable replacement for those stocks. With the depletion of the Bass Strait oil, our main oil production is now in Western Australia, but those reserves are old and rapidly diminishing. It is important that we encourage further exploration in order to find further oil and gas supplies for this country. Hence, although this bill makes a minor amendment to the act, it is quite central to allocating the leases to allow bodies to develop, prospect and explore in those new areas.

Mr Deputy Speaker, I have spoken just briefly about the importance of the bill in that respect, but one thing I probably should leave you with is that, whilst at the moment we have known gas reserves in this country—around 110 years supply—it has been estimated by the International Energy Agency that Australia will become the third largest exporter of LNG within the next decade. Obviously, in that calculation they are factoring in an approximation of further discoveries of gas in this country. I understand from talking to many of the players in the industry that they are relatively confident that the gas is out there. They are looking at various business models that allow them the opportunity to invest in further gas exploration, and this is something the International Energy Agency has already made some judgements on. Within the parameters of the territorial base of this country, within the next decade it is likely that we will emerge as the third largest exporter of LNG.

If we are going to be supplying gas to the world, from my perspective it is also vitally important that we develop the domestic market for gas. Hence, I am an ardent advocate for the development of our gas to liquids and the creation of synthetic diesel through our gas supply. I think that, probably more than most other energy sources, that is likely to be the backbone of the future of this country. Whilst the resources of this country will be many and varied and we will require a suite of responses to accommodate our future energy needs, I believe that the development of gas to liquids as well as coal to liquids is going to play a very significant role in the future energy needs of this country. On that basis, I commend this bill to the House.

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