Vic parliamentary committee to consider viability of onshore gas exploration
Victoria is the only state in Australia to ban onshore gase exploration, but that could soon change with the State Government awaiting the report of a parliamentary committee investigating the industry. However, Victorian farmers have funded tens of thousands of dollars for research - not into the effects of gas exploration, but rather into the industry's economics. The study, to be presented to the committee, suggests there would be little demand for gasfields in Victoria - something that the resources sector disputes.
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ELEANOR HALL: To Victoria now where farmers have funded tens of thousands of dollars for research - not into the effects of gas exploration, but into the economics of the industry.
Today the researchers have presented their findings to a state parliamentary committee considering the industry's future.
As Tom Nightingale reports.
TOM NIGHTINGALE: The huge potential and possible risks of coal seam and shale gas are particularly controversial in Victoria's Otway Ranges and Gippsland regions.
Mal Rowe is a lamb and beef farmer at Byaduk North, in the state's western district.
MAL ROWE: We question things like this ongoing narrative from the gas industry which talks about an increasing demand for gas in Victoria and Australia. The answer is no there's not.
TOM NIGHTINGALE: Are you stepping away from the campaign on the agricultural impacts?
MAL ROWE: Not at all. One informs the other and whilst our concerns will primarily be for agricultural impact, we ask the question again, "Why would you establish an industry that could potentially put that agriculture at risk?"
TOM NIGHTINGALE: Mal Rowe and others have paid $25,000 dollars to have gas demand studied.
The research was done by former Exxon Mobil and BHP Billiton engineer Tim Forcey, now with the University of Melbourne's Energy Institute.
He has presented the results to a state parliamentary committee this morning.
TIM FORCEY: Studies have shown there's no economic reason to hook new house up to gas and there's no reason to hook new suburbs up to gas. But this is new, particularly in Victoria where gas for years and years, was a very economical and plentiful supply of energy. The economics have changed.
TOM NIGHTINGALE: This issue doesn't really come down to demand locally for gas though does it? It's more about the pros and cons of an energy resource?
TIM FORCEY: You're exactly right; there's a very large picture of that energy that is being debated and needs to be studied. Our research is just delving into one piece of that which we think is important. Yes, it's only a part of puzzle, but it's a part that does get skated right past.
TOM NIGHTINGALE: The peak body representing the oil and gas industry is the Australian Petroleum Production and Exploration Association.
The chief operating officer is Paul Fennelly.
PAUL FENNELLY: Victoria is the largest consumer of gas, both domestically - households - and of course the industrialised sector, the manufacturing sector. So gas is a critically important issue for Victorians.
TOM NIGHTINGALE: The industry body disputes the research findings and says demand for gas is going up.
PAUL FENNELLY: We need to put a downward pressure on gas prices on Victoria. If we don't we're going to pay the consequences, and this is not alarmist it's just fact.
If we don't have competitive priced gas, thousands of jobs in the manufacturing sector could be jeopardised. It's crunch time for Victoria and crunch time for the gas industry in this state.
TOM NIGHTINGALE: Victoria is the only Australian state to ban onshore gas exploration.
The State Government says the ban could be lifted, depending on what the committee finds.
The committee's report is due by the 1st of December this year.
Gas; Geological resources