PERTH (miningweekly.com) – Federal Minister of Industry and Science Ian Macfarlane announced on Wednesday that the government would work to address challenges in the gas market arising from the domestic market linking with international markets.

In launching the Energy White Paper, Macfarlane noted that work in this area would include removing unnecessary barriers to increasing supply, ensuring adequate competition and transparency in the upstream gas market and encouraging more flexible trading arrangements through trading hubs.

“We are commissioning an Australian Competition and Consumer Commission inquiry that will look into the effectiveness of competition in the gas market, in response to ongoing concerns about market transparency. The terms of reference for this work will be released shortly,” the Minister said.

The energy sector was a major source for export earnings, and was expected to contribute some A$114-billion to state revenues by 2020.

“We export around 80% of our energy production and these exports totalled A$71.5-billion in 2013/14 and provided jobs for around 170 000 people,” Macfarlane said.

“The White Paper recognises that investment, particularly foreign investment, is essential to realising the potential of Australia’s natural resources and technology innovation.

“It highlights action we are taking to adopt new technologies and promote Australia as an investment destination.”

Macfarlane said that the Energy White Paper would deliver competitively priced and reliable energy supplies by promoting competition in energy markets, increasing energy productivity and facilitating investment in energy resources development.

“The measures in the Energy White Paper will deliver stable energy policy and efficient, transparent markets that give consumers information to make choices about their energy use and industry the confidence to invest,” he added.

The White Paper also built on other initiatives to reduce pressure on energy prices and increase Australia’s competitiveness as a global energy supplier, including the A$5-billion Asset Recycling Initiative, encouraging states and territories to free up capital to invest in new economic infrastructure by privatising state- and territory-owned assets, and a A$188.5-million spend on Industry Growth Centres, which would lift competitiveness and productivity in areas of competitive strength, including the oil, gas and energy resources sector and the mining equipment, technology and services sector.

The White Paper further suggested a A$476-million investment into an Industry Skills Fund, building the highly skilled workforce needed to adapt to new business growth opportunities, rapid technological change and market-driven structural adjustment, and a further A$484.2-million for an Entrepreneurs’ Infrastructure Programme, providing companies with structural and strategic support to capitalise on growth opportunities.

The Australian Petroleum Production & Exploration Association (Appea) has welcomed the release of the White Paper, saying it recognised the oil and gas industry’s critical role in delivering economic growth and energy security.

“At a time when some interest groups are seeking a return to protectionism and a leg up from gas producers, a long term policy position rejecting gas reservation is an important signal to investors,” Appea acting CEO Paul Fennelly said.

“Policies that enhance Australia’s attractiveness as a place to do business and encourage industry to increase domestic gas supplies can deliver another wave of prosperity in addition to the current A$180-billion pipeline of investment in liquefied natural gas export projects.”

The Queensland Resources Council (QRC), meanwhile, said that while the blueprint for Australia’s energy future was a plan for future investment, it was a missed opportunity for enhancing fuel security.

QRC CEO Michael Roche said while the plan did highlight that coal and gas would underpin the global energy mix for decades to come, it fell short in delivering a plan for fuel security for Australia and its growing dependency on oil imports.

“The White Paper states that more than 90% of Australia's transport fuel is petrol, diesel and aviation fuel, which cost A$30-billion and could grow three-fold to A$90-billion by 2030,” Roche said.

“The Energy White Paper is a missed opportunity for enhancing alternative fuel sources and reducing our dependence on just-in-time supplies of fuel arriving before our economy runs out of fuel.”

Roche added that while the White Paper did state that investment was needed in exploration, infrastructure, innovation and skills to maintain a robust energy sector and sustain Australia’s energy security, it failed to identify how this investment might occur in alternative fuels.