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WA's oil and gas future bright - report

19th November 2021

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – Investment in new oil and gas projects in Western Australia could contribute to between A$236.6-billion and A$439.9-billion to the state’s economy over the next 20 years, an independent report commissioned by the Australian Petroleum Production and Exploration Association (Appea) has found.


The report, undertaken by EY, noted that over the next 20 years, an additional A$90-bilion could be invested in new oil and gas capacity in Western Australia.

Appea CEO Andrew McConville said the report The economic contribution of Western Australia’s oil and gas industry  showed that Western Australia’s natural gas advantage has the potential to turbocharge Western Australia’s economy for years to come.

“The AFL Grand Final was a one-off economic bonus for Perth but this could be like holding the AFL Grand Final every day in Western Australia for the next twenty years, that’s how much natural gas could mean to the state’s economy going forward,” McConville said.

“Gas means jobs, gas means cleaner energy and gas means economic prosperity, particularly in regional Western Australia.

“The report shows our state has already benefited greatly from reliable and affordable natural gas supplies, adding A$220-billion to the Western Australian economy over the last decade. It also predicts a similarly bright future, with high demand for cleaner energy in Asia maintaining demand for Western Australia’s gas exports as developing countries in particular look to switch from coal to gas to reduce emissions.

“In fact, EY found that with the right policy settings a further $90 billion could be invested in the Western Australian oil and gas industry over twenty years, generating an additional A$439.9-billion to Western Australia’s gross state product (GSP) under a high growth scenario.

“The benefits of this investment are particularly pronounced in the short-term as projects are constructed, with up to 9 700 full-time jobs created in 2027 under a high growth scenario, and 8 300 jobs in 2040.

“Even under the low growth scenario, the contribution to GSP is estimated to be A$236.6-billion over the 20-year period.

“To put these numbers into perspective, the annual tax revenue generated by these new projects would be A$5.8-billion, enough to fund the new Women and Babies Hospital, a new desalination plant, the Tonkin Corridor upgrades, and 50 new primary schools and 500+ teachers.”

Appea’s Western Australia Director Claire Wilkinson said that the economic benefits of continued investment in the oil and gas sector were substantial, it would also benefit the environment.

“The Glasgow Climate Pact agreed at COP26 only reinforces that, as countries switch from coal-fired power to lower-emissions, natural gas is well placed to provide the reliable, affordable energy that they need.

“The Australian government estimates Australian liquefied natural gas (LNG) exports have the potential to lower emissions in LNG-importing countries by about 166-million tonnes of CO2-equivalent a year by replacing higher emissions fuels. That equates to over a third of Australia’s total annual emissions.

“Natural gas has only half the greenhouse gas emissions of coal when used to generate electricity and it can do things renewables simply cannot do such as provide the high temperatures and essential feedstock needed to produce manufactured products like fertilisers, cement, steel and plastics.

“In addition, our industry is making billion-dollar investments in emissions-reduction technologies. The oil and gas industry has the technology, skills, experience, and commercial relationships to develop a world-scale hydrogen industry both domestically and for export, as well as critical decarbonisation technologies like carbon capture and storage,” said Wilkinson.

Edited by Creamer Media Reporter

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