Over three days, representatives from all sectors of Australia’s upstream oil and gas industry gathered to network, discuss new ideas, showcase products and services, and celebrate APPEA’s 50th anniversary.

APPEA Chairman Eric Streitberg compared the very first APPEA Conference with this year’s, drawing attention to the exponential growth of Australia’s oil and gas industry and the annual conference itself over the past 50 years.

“The industry has to ensure it retains its licence to operate so that we can continue to supply the relentless and growing demand for hydrocarbons and especially the demand for gas with its greenhouse friendly profile,” Mr Streitberg said.

“There is also the untapped shale gas potential in Australia. If the US is a model, this source of gas has as much potential as coal seam gas (CSG), and really does show what innovation our industry is capable of.”

Tax-ing debate

‘Tax' was the word on everyone’s lips. The announcement of the Federal Government’s proposed Resource Super Profits Tax (RSPT) the week before the conference ensured intense discussion and debate throughout the event.

Recent amendments to the tax program have followed a consultation with industry.

Minister for Resources and Energy Martin Ferguson commended in particular the CSG industry for engaging in consultation.

“I am pleased to say that CSG companies were the first people in the door…after the new tax plan was announced,” he said.

Regulating the industry

Safety

Mr Ferguson also discussed the incidents in Montara and the Gulf of Mexico.

“With Varanus Island on 3 June 2008, Montara on 2 August 2009, and the Deepwater Horizon in the Gulf of Mexico on 21 April this year, the industry has had a very unfortunate two years,” he said.

“Australia has to learn the lessons of Montara and the Gulf of Mexico, and ensure firstly, that we have a world-class regulatory system in place and secondly, that we have competent and professional operators in the industry.”

Approval

As well as safety regulation, Eric Streitberg highlighted that a streamlined approvals process for oil and gas projects would benefit both industry and government.

“The Productivity Commission report recognised that it is well past the point where the community derives any extra benefit from the layers of approvals, and action on the numerous recommendations is sorely needed,” he said.

Global demand for Australian LNG

An APPEA-commissioned KPMG report released at the conference gave an overview of the Australian gas market and its growth prospects. The report found that Australia has no shortage of natural gas and that natural gas will serve an increasingly important role in Australia’s economy.

The KPMG report also states that the Asian LNG market is the largest and fastest-growing LNG market in the world, and that Japan, China and India represent critical LNG export markets for Australia.

During her address to the conference, QGC Managing Director Catherine Tanna said that LNG demand remains healthy but that a number of LNG projects in Australia and other countries are competing for this demand.

“While new projects and growth are highly feasible, proponents with multiple trains, expansion projects and large, established LNG portfolios are at an advantage in an environment where customers are seeking security of supply,” said Ms Tanna.

Deloitte Touche Tohmatsu Oil and Gas Global Leader Adi Karev spoke about the current shift in energy demand and economic power from West to East, and the role Australia will play as a resource supplier situated in a prime geographic location.

Mr Karev said that China’s economic stability and National Oil Companies, which are emerging as dominant players in the global oil and gas market, are working to cause the migration of the energy consumption centre to the East. “The LNG market in China is being driven by two issues: climate change and forecast economic growth,” he said.

According to Mr Karev, “Australia’s role in this shift in energy consumption…is one of reliable supplier as it offers abundant gas reserves, efficient production and distribution infrastructure, low political risk and close proximity to main customers and markets in Asia.”

Gas Today representing the industry

The Gas Today team were on hand in the exhibition, distributing copies of the magazine, Gas Today pens and the classic ‘I love natural gas’ stickers.