Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Hansard source

Today I rise to speak on the Offshore Petroleum and Greenhouse Gas Storage Legislation Amendment (Miscellaneous Measures) Bill 2010 and the Offshore Petroleum and Greenhouse Gas Storage (Safety Levies) Amendment Bill 2010. Before I do so may I congratulate you, Mr Deputy Speaker Georganas, on the very strong endorsement of you by your community at the 2010 federal election.

This amending legislation, I believe, is very important not only for my part of the world, Corangamite, but also for many other parts of regional Australia. These bills will make minor policy and technical amendments to the Offshore Petroleum and Greenhouse Gas Storage (Safety Levies) Act 2003. It will improve the ability of the National Offshore Petroleum Safety Authority, the regulator in this area. The Montara Commission of Inquiry and the recent events in the Gulf of Mexico have moved the Australian government to improve the regulation of petroleum operations and I think that is very wise indeed.

There will of course be no adverse effect on industry and there will be no extra costs to industry, and that is also very important. This legislation will also simplify the safety regime for titleholders and will make titleholders accountable when necessary, as spelt out by these bills. This legislation will remove direct responsibility from a titleholder for facilities which it has no direct control over. This legislation will not adversely affect any regional people. That is great for my electorate of Corangamite, which is in regional Victoria. This industry is a very important component of my regional economy and of many other regional economies across this region.

These bills will go a long way to making this industry safer, and that is excellent news for regions like mine that of course do provide substantial income to the national economy. This industry is very important in many parts of the country. Within my electorate I have, just offshore, the Otway Basin, which is a very important gas production area in south-eastern Australia, and it provides a very substantial volume of gas to Australian markets.

Indeed, as at December 2009, the Otway Basin’s petroleum fields provided a very substantial volume of gas to the market. Some 23.4 per cent of eastern Australia’s conventional gas production came from my part of the world. This equated to some 1,197 petajoules, which equates to some 17.8 per cent of Victoria’s conventional gas reserves, a very substantial volume and a very substantial economic asset for our part of the world. The basin also produced some 3.5 per cent of eastern Australia’s total gas reserves and some 3.1 per cent, 70,000 tonnes, of Australia’s liquefied petroleum gas, LPG—again, very substantial components. The basin also produces a small amount of condensate, some 708,000 barrels, or 1.2 per cent, of Australia’s production. This is a significant contribution from my region and it is a very important industry—an industry that will grow and develop over time.

The Otway Basin has three major gas projects which all transfer offshore gas to onshore treatment for processing and distribution. The largest development in the Otway Basin is the Otway Gas Project. It is a $1.1 billion development some 70 kilometres south of Port Campbell. We need to encourage these industries because these industries will not only help to significantly grow my local economy but also grow many regions such as the Geelong region as we move forward.

I also have some very significant natural resources within my seat. I have the Great Ocean Road, the Surf Coast and the Bellarine Peninsula. If we do not get regulation in these areas correct and we have oil spills such as Montana or the disaster that took place in the Gulf of Mexico then that would place very significant pressure on my seat and on many other areas in Australia that often have very significant tourism related activities. That is why we need to have strong regulation in these areas. I congratulate the Minister for Resources and Energy on ensuring that we do have strong regulation that takes account of the very significant risks that do occur within this industry. Tourism is also a very significant job producer within my area. That is why we need to ensure that the offshore petroleum industry can deliver its product to market safely and that the right mechanisms are put in place to protect our very significant regional economies.

As I mentioned earlier, offshore petroleum is becoming a very major part of the economy and a major employer within my electorate—and I know it also is within many other parts of regional Australia. We need to make sure the wells and the overall industry are safe and have the right amount of regulatory oversight and protection. This will have a direct benefit for the workers in the industry and I think it is also a step in the right direction in growing our regional economies. For these reasons, the minister has taken the responsibilities of the offshore oil and gas industry very seriously. We have a very safe industry and very productive industry. But we also know that there are some very significant risks and we need to ensure that we deal with them. These amendments will give NOPSA the ability to regulate and keep the industry safe.

The intentions of this government are very clear through these bills. These bills will strengthen the role of the National Offshore Petroleum Safety Authority. This is certainly something I welcome, and I am sure most people in this place also welcome it. They will make it clear how the titleholder provisions apply, particularly when there are two or more titleholders. It will also make the titleholder more accountable by making clearer the titleholder’s responsibility under the occupational health and safety provisions of the act. These bills will also arrange safety levies to ensure that the appropriate levies can be collected for pipelines in designated costal waters.

As I mentioned earlier, in my part of the world gas is collected offshore, piped onshore and then processed, so it is important that we have regulation in this area to ensure that that can happen in a safe way. After the Montana oil spill, which was a huge tragedy here in Australia, we needed to make some adjustments to NOPSA’s functions so that it could be more effective and fully regulate the structural integrity of petroleum and greenhouse gas facilities. These amendments do not extend NOPSA’s role beyond that of an OHS regulator but do take it in a step in that direction. The regulator can not witness all wells of any note. The government has toughened some of the offence provisions to ensure that industry take full account of their responsibilities. This will encourage titleholders to inform NOPSA if there are any problems with wells or any other issues.

It is at this point that I would like to place on record the reality that, as we move further offshore and into deeper waters, risks become more substantial. The engineering challenges also become much more substantial and need to be properly regulated and managed. I think these arrangements go in some part to dealing with that as an issue. This all means that a higher safety burden will be placed on the titleholder. I think that is appropriate, particularly with respect to some of the offences already spelt out by the bill.

The Gillard government is very keen to ensure that we have appropriate regulation in place to protect the health and safety of workers, that we have good regulation in place that will protect the environment and that we have good regulation and legislation in place that enables us to take full advantage of our natural resources. As I said earlier, we have very substantial assets in my electorate of Corangamite—and I know many other regional members equally have very substantial assets with respect to oil and gas. For us to take full advantage of that, government needs to take certain measures to ensure that we enable industry to extract it in a way that is safe for workers and the environment.

I would like to congratulate Minister Ferguson for working diligently on these matters over the last few years. I believe the actions that he has taken will enable this industry to grow in a sustainable way that will protect the interests of workers and enable our economy to grow as we take full advantage of our natural resources. I commend the bills to the House.

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