Gas to underpin Australian steel comeback

THERE is no silver bullet to Australia’s current domestic economic woes, but federal minister Karen Andrews today reiterated the federal government’s intentions to remove environmental red tape and put the pedal to the floor for future oil and gas development.
Gas to underpin Australian steel comeback Gas to underpin Australian steel comeback Gas to underpin Australian steel comeback Gas to underpin Australian steel comeback Gas to underpin Australian steel comeback

Paul Hunt

Senior Journalist: Oil & Gas, Policy.

Paul Hunt

 

In a speech to the National Press Club today the minister for Industry, Science and Technology Andrews acknowledged the severe hit business had taken to investment due to the coronavirus pandemic. 

While the minister's carefully curated oration focussed on building the manufacturing sector, gas and energy were a key component to her remarks. 

Andrews said energy and technology was a "national priority" and would underpin Australia's manufacturing sector and domestic economic recovery. 

She said she was working "closely" with resources minister Keith Pitt and energy minister Angus Taylor to ensure affordable gas prices for the manufacturing industry and flagged a comeback of affordable steel production and exports as an underlying area of domestic economic recovery. 

"I am at the consumer end. For Australian manufactures I want to make sure they get the best energy prices they can."

Specifically, Andrews flagged a revival of Australia's steel manufacturing sector, despite a global oversupply of steel. 

This would rely on affordable electricity and gas prices, and the government is not yet considering hydrogen, according to Andrews. 

Hydrogen-led ‘green steel' is one idea put forward by centrist think tank the Grattan Institute to drive Australian green jobs and manufacturing while replacing those lost from retirement of coal mines. 

"We need to ensure our steel manufacturers are getting the best energy costs. Energy is a critical input to them. I encourage them to look at how they are going to minimise their energy costs, but hydrogen [is still in early stages]" Andrews said. 

The minister said she understood business was investing heavily in the future energy source, but Australia was a "resource rich nation" and the government was already looking at "how and if" hydrogen could become an export further down the track. 

"Hydrogen is something we are investigating… but it is something a number of years away and it won't be in place for several years to come." 

Instead, Andrews is betting on natural gas being the primary feedstock for manufacturers. 

The minister used her speech to spruik the government's plans to further reduce the price of gas in wholesale markets, saying "cheaper gas" and "reduced cumbersome red tape" would benefit business and improve access to export markets by making products like steel cheaper. 

Cutting red tape will be "perhaps the biggest positive impact without further demand on taxpayer support," Andrews said. 

Exactly what these cuts to red tape look like remain to be seen. However Andrews flagged simplification of regulations and fast-tracking of major projects in her speech. 

Yesterday Angus Taylor also spruiked the benefits of a new financial incentive scheme for oil and gas companies which worked on new carbon capture and storage projects. 

In her speech to the National Press Club this afternoon, minister Andrews also noted the government's intention to make energy technology exports more accessible. 

Last week the government announced a $1.4 million handout for Subsea Energy Australia - the peak body for Australian offshore contractors - to do just that, develop a new export hub for oil and gas technology. 

 

 

 

  • FREE coverage on the rapidly developing coronavirus pandemic. Visit our COVID-19 hub.
  • Latest COVID-19 Coverage: Govt's COVID-19 Commission under scrutiny. Read more.
  • Latest COVID-19 Coverage: NT throws cash at oil and gas industry. Read more.