18 September 2014
Dow Chemical hits out at Victoria, NSW politicians for gas bans
The local chief of one of the world’s largest chemical companies has criticised the Victorian and NSW governments for standing in the way of gas supplies needed to avert a supply squeeze while they wait to get elections out of the way.
Billions of dollars of investment are on ice and east coast manufacturers face a doubling in gas prices and severe shortages in coming years as new liquefied natural gas projects in Queensland drain supplies from Victoria and NSW.
The states have full or partial bans on onshore gas production in place ahead of elections this year and next year.
“We need the federal and state governments working together to come up with a solution,” Dow Chemical Australia chief executive Tony Frencham told The Australian Financial Review. “What we don’t need is state governments waiting to get past their respective elections.”
The Victorian government goes to the polls in November and has a hard moratorium on coal seam gas production in place, which it recently extended to gas in “tight rocks” by pulling small explorer Lakes Oil’s licence to drill in Gippsland.
The NSW government has blocked coal seam gas production in much of the state, and faces a court action for pulling Metgasco’s licence near Lismore. It goes to the polls next year.
Mr Frencham said the Victorian government’s own task force had given it a clear road map and “we in the industry are not advocating anything less than world’s best standards” which have been developed in coal seam gas and tight rocks. “We know how to do it safely from experience around the world,” he said. “We should import those standards and we should let the market operate.”