rosetta moon

THE Rudd Government has finally revealed that it will impose limits on Chinese takeovers of Australian mining companies as it grapples with a $30 billion wave of Chinese foreign investment proposals. (The Australian, July 8, 2008)

In a move that threatens to aggravate tensions with Beijing, Treasurer Wayne Swan said he would “more carefully” examine proposed takeovers of Australian resource companies by foreign companies that were buyers of Australian iron ore, coal and other resources, or were state-owned.

He called this policy “open, in the national interest”.

Congratulations to the Treasurer Wayne Swan and Energy Minister Martin Ferguson for starting the reform, which is truly in the national and the global interest – in terms of long term and sustainable management of energy. It raises the question on how the current government will manage the legacy of the Howard government and install practical policies with demonstrable and real effects in enabling us to now consider the merits of a national strategic energy policy.

The supply and demand questions facing the nation, in relation to gas, have been mapped out carefully on the Peak Energy site , Australian Natural Gas – How Much Do We Have And How Long Will It Last:

At present, there are 2 LNG plants in operation – the North West Shelf gas project (operated by Woodside Energy) near Karratha in WA, and the Conoco Phillips Darwin LNG plant in the Northern Territory. The North West Shelf project is the third largest LNG exporter in the world, with its fifth LNG train due to commence operation this year, bringing the capacity of the plant to 16.3 million tonnes (0.85 tcf).

To put the Australian figure in context, proven world gas reserves are estimated to be over 6200 tcf – Australia has around 1.4% of the total.

A sober reminder – what we have now wont last forever so we need to prioritise national interest, as does any nation, and such situations , as it happens align themselves to better management of global energy reserves. Should the embodied costs of cryogenically cooling natural gas and exporting by tanker be examined, we are presented already again with a dilemma which needs addressing, ahead of further motherhood statements, reports or emissions trading schemes that promise the world but are less pragmatic than logical policy making in consideration of the future, which we see slowly emerging as we grapple with a global energy rush – fueled largely by the continued expansion of the Chinese economy, which may need to re-examine its own future without recourse to under-cost subsidised industry policy, put in place by previous administrations, and well appreciated by an energy hungry world.

And as the federal government dis-entangles itself from these engagements opportunities will fast emerge for the Australian economy, which is well placed to manage itself locally and with less risk disconnected from the import of carbon fuels, which has been making constant headlines in the paper. The next step for Australia will be the improved management of its natural gas infrastructure to enable the vast western reserves to be tapped sensibly into the eastern grid which is a small task in comparison to what has been achieved so far.

The missing links in the puzzle are a pipeline from the Carnavon Reserves to Kalgoolie, diverting east to Whyalla in South Australia, completing a useful connection to the eastern grid. Follow that with completion of the network between Newcastle and Brisbane and a national grid is complete enabling the establishment of a national natural gas refueling network, ensuring clean and reliable transport into the future.

Further Information:

Liquefied natural gas a tinder box for Labor

Treasurer slams gate on Chinese raids – The Australian July 8, 2008

NT chief calls early poll to help win $12bn Inpex plant

Australia LNG projects worth $58b at risk: Woodside – Reuters

Australian Natural Gas – How Much Do We Have And How Long Will It Last ? Peak Energy

The Global Liquefied Natural Gas Market: Status and Outlook (U.S. Dept Energy)

Consumer Protection Attorney Tim Riley warns about Liquified Natural Gas

Lloyds Insurance Underwriters outline LNG Risk

LNG Has 35% Higher Lifecycle Greenhouse Gas Emissions Than Coal :

LNG industry safe: Kevin Rudd

In the September 2007 edition of the journal Environmental Science and Technology, Carnegie Mellon researchers show that liquefied natural gas (LNG) imported from foreign countries and used for electricity generation could have 35 percent higher lifecycle greenhouse gas emissions than coal used in advanced power plant technologies. The researchers point out that LNG has many indirect impacts compared to domestic gas. LNG is extracted in a foreign country, liquefied, put into a tanker to cross oceans, and then regasified and put into pipelines when it reaches the U.S. Each of these steps leads to indirect environmental impacts, such as carbon dioxide emissions from changing from gas to liquid and back.

Australian Gas Projects: