Australia’s federal government has released its 2023 Budget, with the offshore industry saying it listened to industry concerns.
Australian Petroleum Production & Exploration Association (APPEA) Chief Executive Samantha McCulloch said the new Future Gas Strategy showed the government recognised the urgent need for a strategy to secure new gas supply to avoid shortfalls in coming years.
“New gas supply is essential to keep the lights on, put downward pressure on prices and deliver substantial economic benefits in the transformation of our energy system for net zero,” McCulloch said. “The national strategy announced tonight is a response to independent reports and authorities warning of gas supply shortfalls and allows for a coordinated policy response.”
The Budget allocates A$2 billion to accelerate the development of low-carbon hydrogen in Australia and to catalyse clean energy industries. Australia already has the largest pipeline of renewable hydrogen projects in the world.
McCulloch said: “Low-carbon hydrogen has a critical role to play in reaching net zero, in particular in hard-to-abate industries and manufacturing. The oil and gas sector is pivotal in scaling up and rolling out low-carbon hydrogen in Australia and globally, with natural gas combined with carbon capture representing the most developed and lowest cost pathway to low-carbon hydrogen available today.”
The Budget also recognised the importance of CCUS, with a review of regulations to enable CCUS investment – as highlighted by APPEA in its 2023-24 Federal Budget Submission. However, the McCulloch says the Budget fell short of committing to a national CCUS roadmap in partnership with industry to provide the clear policy direction needed to promote Australia as a regional carbon storage leader. “Global momentum for CCUS is growing, and Australia must not miss the emissions reduction and economic opportunity of an emerging CCUS industry that creates new jobs and investment.”
APPEA also welcomed the review of environmental management regulations for offshore energy to provide clarity for major supply projects.