[Peakoil-announce] Australia's oil deficit

[Jenny Goldie]

Keith Orchison
Australia's oil deficit blow-out 
Business Spectator 31/5/2010 http://www.businessspectator.com.au/bs.nsf/Article/Australias-oil-deficit-blow-out-pd20100531-5XRR3?opendocument&src=rss 
 
The federal government dropped a rather startling statistic on the table during May and hardly anyone noticed. Speaking to the Australian Petroleum Production & Exploration Association conference in Brisbane, Martin Ferguson revealed that we now have a national trade deficit in crude oil, refined products and LPG of $16 billion a year, heading for $30 billion by 2015. What is startling about this is that only two years ago, at the APPEA conference in Perth, the Energy Minister warned that Australia was "looking down the barrel" of an annual deficit of $25 billion by 2015. In other words, the cost of meeting our transport fuel thirst by mid-decade is seen by the government to have blown out by $5 billion a year. What's more, the current cost is substantially higher than it was in 2007-08 when the Rudd government came to office. The only people to leap on this so far have been Queensland Energy Resources, who are trying to launch an oil shale development near Gladstone. QER has released modelling undertaken for them that shows the deficit could be more than $90 billion by 2030 under fairly modest conditions. They want to develop a $20 billion shale-to-oil industry that will cut the import needs by about $4 billion a year and the company has been quick to praise Ferguson for providing a timely 'heads up' on the issue - which it would be if anyone in the media or in politics was paying attention to anything other than the RSPT. Tony Abbott also spoke to the APPEA conference two days after Ferguson and he and his staff must have read the Minister's speech, but the Opposition Leader made no attempt to seize on this opening. Does the opposition have a plan to address an issue that will start to loom much larger in the next term of government, with a projected further lurch downward in domestic crude oil production in 2012? Critical factors, of course, in estimating this import bill include not only how much we need in transport fuels but also the international crude oil price and the value of the Australian dollar. Also important is how much we succeed in exporting other energy products - especially coal, uranium and liquid natural gas (and associated condensate) - in order to fill the transport fuel gap. Shifting some of the burden on to domestic synthetic fuels production - oil shale, coal-to-liquids and gas-to-liquids - are all possibilities for Australia, but these are not developments than can be brought on quickly and their viability in an environment including carbon pricing and now the mining profits tax is an open question. The national energy resource assessment Ferguson released earlier this year says that, without a major oil discovery, domestic crude production will continue to decline while consumption, even depressed by carbon policies, is forecast to grow by an annual average of 1.3 per cent out to 2030. In simple terms, we were self-sufficient in oil production in 2000 and are now a little less than half self-sufficient - and by 2030 on present trends will be meeting only a fifth of our needs from our own resources. In a television interview two years ago Martin Ferguson acknowledged "huge problems on the (fuels) trade front" and, on his own numbers, the elephant in the room has put on a lot of weight since then.