Nick Xenophon (SA, Independent) Share this | Hansard source

I do not intend to take up too much of the Senate’s time in my response to the Excise Tariff Amendment (Condensate) Bill 2008. The purpose of this bill is to impose excise on condensate which is currently excise free for companies operating on Australia’s North West Shelf. Condensate is a form of crude light oil that is produced when natural gas is extracted. It is used mainly for the production of petrol and domestic gas. When the crude oil excise was introduced in 1975, condensate was exempted so that the infant liquefied natural gas industry could develop. But the industry has grown up and now it is time to pay up.

Over 30 years later, there is merit in the government’s argument that this is no longer an infant industry, and this excise loophole can and must be removed. The industry can hardly complain. It is important to note this is only an exemption from excise for the North West Shelf. Other regions with similar processes do not share in this exemption, although some regions do face a primary industries resource tax.