Straya loses big as gas cartel war profiteering returns
The gas cartel is busy distracting you with complete garbage.
Labor needs to answer how its gas reservation scheme will work in times when gas is abundant, Origin Energy chief executive Frank Calabria has warned, or risk killing off incentives for future supply.
Labor has proposed the biggest intervention in Australia’s gas industry in decades, forcing LNG exporters to supply up to 20 per cent of their volumes to the domestic customers.
Australia’s gas industry has insisted the policy is a huge risk. Not only will it damage the country’s resource sector, Woodside has warned it could back out of a critical drilling campaign if the policy gets legislated and domestic prices slump.
Why would it cut investment? Australian supply makes up only a small share of total production and exports.
Is the gas cartel going to stop investing into the kind of global energy boom underway?
At $100 Brent and $30 JKM, the gas cartel will enjoy a banner year of war profiteering, with previous years also superb as geopolitics overtakes globalised energy markets.
I don’t know how Frank can keep a straight face.
But he and his mates must keep this Big Lie running because if we actually think about what this means, we will get angry and not just do reservation but hike taxes as well.
If we currently had David Pocock’s 25% LNG revenue tax, the local windfall would be approaching $30bn at current prices annualised.
The cumulative revenue loss since the cartel came to be is around $160bn.
Will the gas cartel cut production in this environment? No, it will expand as fast as its greedy little hands can do so.
All domestic reservation will do is force low-cost production to stay in Australia and higher-cost (and still crazy profitable) gas to go offshore.
We should be discussing why we are giving $30bn to the gas cartel in war-profiteering windfall gains.
