The Australian Government has handed down its 2020-21 Budget which includes measures to further support the development of northern Australia and Australia’s gas and resources sector as part of its COVID-19 Economic Recovery Plan.
The Government has announced a series of reforms to the Northern Australia Infrastructure Facility (NAIF) aimed at improving the speed and scope of projects to be funded that will further unlock economic opportunities and more jobs across the north.
The 2020-21 Budget also contains measures to support a gas-fired economic recovery as well as initiatives to strengthen the nation’s resources and exploration sectors.
The Government will ensure Australia continues to be a major gas exporter while also delivering affordable gas to the domestic economy and strengthening the reliability of the country’s electricity network.
As part of its gas-fired recovery plan, the 2020-21 Budget includes $28.3 million to develop five Strategic Basin Plans which will unlock and accelerate the development of vast gas reserves, increase domestic supply and lower prices for households and businesses.
This will start with plans for the Beetaloo Basin in the Northern Territory and the North Bowen and Galilee Basin in Queensland.
The Government is providing $13.7 million over four years to provide quality assured scientific research and information to communities living in gas development regions through the CSIRO’s Gas Industry Social and Environmental Research Alliance.
This complements investments by the Minister for Energy and Emissions Reduction in an inaugural National Gas Infrastructure Plan, as well as gas regulatory reform initiatives.
The Budget includes $124.5 million to fund an expanded Exploring for the Future Program.
The program, operated by Geoscience Australia, will deliver detailed data on potential resources in vast areas that have yet to be fully explored. This funding will help unlock new resources along two major corridors identified as resource-rich in both western and eastern parts of Australia.
Moreover, the Government aims to strengthen Australia’s long-term fuel security through a $250.7 million investment in new diesel fuel storage facilities and progressing reforms to boost the resilience of fuel supply and support local refineries.
This is expected to create up to 1,000 new jobs, increase the nation’s diesel stockholdings by 40 per cent, and contribute towards our International Energy Agency (IEA) obligation while also protecting Australian motorists from higher prices at the pump.
Reforms for the Northern Australia Infrastructure Facility (NAIF) will ensure the $5 billion facility will have more flexibility to bankroll investment in a wider range of projects across northern Australia and will speed up investment approvals. This comes on top of July’s announcement of a five-year extension to the NAIF until 30 June 2026.
“The Australian Government is committed to creating jobs across northern Australia to help the region play a stronger role in Australia’s economic recovery,” Minister Pitt said.
“We are empowering the NAIF to accelerate lending and providing greater flexibility in how it can support projects driving economic and population growth – during the challenging business environment due to COVID-19.”
“We are determined to open up further opportunities to strengthen northern Australia’s contribution to our economy by continuing to support infrastructure and development.”
“NAIF has already invested more than $2 billion in sectors including health, education, resources, energy and agriculture supporting more than 6,500 jobs,” he said.
The Budget also contains an additional $41.5 million to support NAIF’s operations following the decision to extend NAIF.
Industry welcomes the news
The Australian Petroleum Production and Exploration Association (APPEA) Chief Executive, Andrew McConville, said the 2020-21 Budget acknowledged investment is a central pillar to recovery and the oil and gas industry has a clear plan to support the government in driving job creation, skills development and promoting domestic spending and investment across all industries.
“The Budget, together with the government’s previous announcements on energy and technology, recognises the pivotal role of Australia’s oil and gas industry in providing energy security for homes and businesses and making a sustained contribution to government revenues,” Mr McConville said.
According to the APPEA, the oil and gas industry has invested more than $350 billion in the Australian economy over the past decade, has contributed to government revenue through the payment of $71.6 billion in tax payments and levies and supports 80,000 jobs.