By OGJ editors
HOUSTON, Jan. 5 -- Australian government officials' efforts to develop a national long-term energy policy is "badly blurred by the current focus on retail-related matters," an oil and natural gas association representative said.
Australian Petroleum Production & Exploration Association (APPEA) Executive Director Barry Jones' comments came during a meeting of the Australian Institute of Energy in Brisbane on Dec. 10, only days before meetings of the Commonwealth State Ministerial Council on Energy in Perth and the Commonwealth Cabinet's Energy Committee in Sydney.
State energy ministers have been advocating market reform related to electricity and natural gas.
"Delivering the Prime Minister's own call for a 'strategic plan for longer term energy policy' is not a matter of merely micro managing the retail and distribution sectors," Jones said of Australian Prime Minister John Howard.
Government officials are approaching "the wrong route," Jones said. "Instead, there are vital energy demand issues that must first be addressed, and critical supply investments that need to be facilitated."
Key elements
Jones said that key elements of any strategic plan for longer-term energy policy must include an oil exploration and development strategy as well as a natural gas development strategy covering Australia's domestic and export markets.
"The unfortunate result is that we only have some of the pieces of the energy policy
jigsaw puzzle," he said. "We seem to have lost the picture we are supposed to be building, and we also seem to have misplaced those pieces that relate to energy supply."
He said the context for a strategic plan needed to encompass a 20-year period while recognizing growing energy demand and rising energy prices.
"Most importantly, it needs to be based on a clear understanding that without massive investments right across the sector, there is a high risk of energy supply disruptions in the not-too-distant future," Jones said.
He called for a national petroleum exploration strategy that helps attract public and private funding for frontier exploration while providing more attractive fiscal terms for capital raising and more effective approvals processes.
"Efforts by Minister [for Industry, Tourism, and Resources] Ian Macfarlane to address these issues in a comprehensive way are refreshing and welcome by the industry and need the strong support of state ministers and his national colleagues," Jones said.
Imports
Any energy policy also needs to address the economic, social, and political risks associated with a growing reliance on imported petroleum supplies, he said.
"The nation really needs to consider whether a sensible precautionary approach to these risks means having a strategy that encourages both more national investment in petroleum refineries and more national investment in commercially viable alternative energy sources," he said.
Regarding alternative energy sources, he said energy policy should facilitate "a higher level of investment in natural gas-based transport fuels, including gas to liquids and eventually hydrogen."