February 1, 2022
The 2022-23 Federal Budget: Unlocking Australia’s competitive advantage
The Federal Budget period offers a chance for all industries to reflect on the investment environment, and oil and gas is no exception. The past two years’ budgets introduced record fiscal spending to stimulate recovery in response to the COVID-19 pandemic, and there is now an expectation that the 2022-23 Federal Budget will set out a more prosperous course for Australia.
This marks a once-in-a-generation opportunity for Australia to get the settings right. APPEA has recommended several moves on behalf of its members – comprising the vast majority of Australia’s oil and gas sector – to bolster the investment environment in ways that will ensure the oil and gas industry’s ongoing contribution to national energy security, emissions reduction, and economic growth.
It is important that the industry does not become too complacent in the face of a changing energy landscape. Levies introduced in previous budgets, for example, have only served to undermine Australia’s reputation as a safe and reliable destination for investment.
APPEA’s recommendations to government, listed in our Federal Budget submission here, highlight a cross-section of priorities that could help to achieve this.
From reducing barriers for investment (particularly for large-scale projects), to encouraging emissions reduction by introducing investment allowances for new energy activities and projects, to ensuring taxation laws are in line with modern commercial practices, it offers a comprehensive guide for government.
Australia has a natural geological and geographical advantage that provides a strong base for the provision of secure and stable energy not just for our country, but for our major trading partners too, particularly in Asian countries such as China, Japan, and Indonesia.
Australia also possesses an abundance of offshore and onshore potential that has yet to be developed; research by EY found last year that national economic output could increase by more than $350 billion over the next two decades given the right policy settings.
Whether it be the recent FID announcement at Scarborough, carbon capture and storage (CCS) projects such as Moomba, or the numerous prospects in the Beetaloo Basin, there is a wealth of opportunity for the oil and gas industry in Australia to be discovered.
The latest Federal Budget offers a golden opportunity to apply policies and regulations that will help our industry deliver ongoing economic growth, jobs, and a pathway to net zero by 2050 in line with national efforts.