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Monday, 21 March 2011
Page: 2477

Mr RANDALL (6:20 PM) —I am pleased to speak on the Offshore Petroleum and Greenhouse Gas Storage Regulatory Levies Legislation Amendment (2011 Measures No. 1) Bill 2011 and the related bill. As a Western Australian, I am obliged to talk to these bills because they have such an effect on our state. I noticed that the member for Groom and the shadow minister tried to make some sort of flippant comment that other states were relevant in this debate. I understand Queensland is heading towards coal seam gas in a big way and we know about Santos in South Australia and Bass Strait and these sorts of issues, but let’s understand the accepted figures: 67 per cent of petroleum produced in Australia comes from Western Australia and 80 per cent of the reserves are in Western Australian waters, generally. It tends to put our bona fides out there.

It would be remiss of me to allow the member for Robertson to leave without censuring her for trying to somehow connect the CPRS and the tax on carbon dioxide to this bill. It is like the Greens saying that climate change has something to do with the tsunami and earthquake in Japan. It is totally irrelevant and misses the point. A new staff member that knows something about writing on legislation might be handy for the member for Robertson so she stays relevant to the bill.

It is true that this bill imposes three levies. The purpose of the bill is to help discharge its regulatory functions and it will indicate a widening of its ambit to include levies relating to wells as has been said before. Again, to get it on the record, this bill will strengthen the legislation that came into effect on 1 January 2005. The National Offshore Petroleum Safety Authority is an independent statutory authority created under the Petroleum Act. It is jointly administered by the Australian government and state and Northern Territory ministers, who have the responsibility for the offshore petroleum industry et cetera.

The three levies, I will point out early in the piece, which have also been mentioned, are the annual well levy, the well activity levy and the well investigation levy. As I said, it has been pointed out earlier that this is heading towards full cost recovery for the administration and oversight of these operations. That is interesting in itself because one of the parts of the explanatory memorandum to this bill is that anything over $30,000 will trigger a levy. Can you imagine anything in an offshore area being under $30,000? It would probably cost you $30,000 to get a helicopter and a team of guys out there to do an inspection. In other words, they are going to qualify in just about every aspect of investigation. Interestingly, some of the jury is out on whether this is a tax or a levy, and there is a fair bit of discussion as to whether it qualifies as a tax or a levy because a tax is uncapped and a levy is capped. The work on these inspections and monitoring is open-ended. You can continue to collect a levy for a whole range of activities and see it grow and grow as to the sort of work that is being done in relation to that.

Everybody keeps talking about this being a response to the Montara well head platform blow-out which occurred. I heard the minister say it was off Western Australia; it was actually off the Northern Territory, I understand. That is why it came under the jurisdiction of the Northern Territory regulators. In fact the Northern Territory Department of Resources was found not to be diligent after the commission of inquiry. I wonder why they were not diligent. I understand only three people work in the department and one of them seems to be on leave much of the time, so two people from the Northern Territory department are trying to monitor and control what happens in their jurisdiction. The existing legislative regime needs to be adjusted to make sure it covers any of those contingencies.

I am concerned, particularly as a member from Western Australia, because we need to be careful about the centralisation of powers to Canberra. We need a national approach but we do not need a Canberra-centric or centralist approach. We have seen this before. I want to make a comparison that may be a little bizarre but I will point it out in any case—I see my colleague Senator Back from Western Australia entering the chamber and he will understand this very well; dare I say it happened under our watch under the Howard government—when we created the Environmental Protection and Biodiversity Conservation Act under Senator Hill as environment minister, we did not realise what a can of worms we were opening for individual states and jurisdictions. Lo and behold: we now have someone in Canberra—and I will give you an example from my electorate—who decides whether you can have a development in a particular area because there might be black cockatoos on the land. This is relevant to the bill because it shows what happens when you centralise powers to Canberra. You have some hairy pitted, kaftan-wearing, bead-wearing person in the department saying, ‘You can’t have development on that land because we’ve found some black cockatoos or Carnaby’s cockies on that particular bit of land.’

I had one of my businesspeople in the electorate trying to expand a simple sandpit. They did a $10,000 survey and found there were no birds there but, because birds might have been there, they were not allowed to expand. The Dawesville Catholic Primary School was not allowed to expand its sporting oval because it might have been a potential habitat for black cockatoos. This is what comes out of Canberra. When you are 3,000 miles away in Western Australia and you have got somebody in a department in Canberra telling you how you are going to run the show on the west coast, it is not very relevant.

This is why not only me but other members are concerned about some elements of this bill. It is correct: yes, we support the intention of the bill but we are flagging some of the issues that could be a problem. For example, we have not had any bad incidents over the 40-odd years that it has been administered by the Western Australian state government over a number of state governments—not just the coalition government; certainly, the previous government was Labor. The only one I can think of was the Varanus Island blow-out but that was dealt with immediately. It was when the Apache Corporation allowed some of the materials to be run down and it caused a problem with gas flow to Western Australian industry and houses. To say that this needs to be done because of the Montara blow-out is, I suspect, an overreaction and a potential power grab from Canberra. We are not satisfied totally as a state government in Western Australia that the arrangements today are the best option for our state and the industry in general.

The federal Labor government is intent on centralising power and diminishing the role of the states. We have seen this in Western Australia in terms of our services. Western Australia is seen as almost too far away and a great cash cow. You only need to look at the way they view us in terms of the GST: 68c in the dollar at the moment, and going to 72c, while Queensland is 91c and New South Wales is 93c. We are sick and tired of being used as the cash cow for Australia. Most of the resources, not only oil and gas but the mineral industry, are centralised in Western Australia. They wanted to give us a mining tax. They want to give us a tax on carbon dioxide so that we can export jobs and pollution offshore. We are getting sick and tired of Canberra dictating to us about how much good they are going to do for us 3,000 miles away.

These centralist initiatives are all too common, particularly from the Rudd and Gillard governments. This is being driven by the coalition of the Gillard-Brown government. We need to make sure that it is understood that this is not the Gillard government; this is the Gillard-Brown government that is now deciding that it is going to impose a whole lot of social and environmental measures on us that would not have been done before, because the green tail is wagging the red dog.

The Western Australian state mines minister, Norman Moore, is very concerned that some of the powers in Western Australia will be taken away from his department. Not only that, but $15 million will now be taken out of the Western Australian state budget. The full cost recovery of levies for this oversight will now be sent to Canberra and it will be administered from Canberra, and Western Australia will be left out. The Western Australian Premier, Colin Barnett, opposes Mr Ferguson’s plans to set up a single national offshore petroleum regulator. He said it was a mistake made by the Northern Territory department of resources and it would not have occurred in Western Australia. We do not mind if you go and have a look at the Northern Territory; after all, it is a territory, not a state. They might need some help in terms of resources. They are undermanned in their department in any case. We realise that there needs to be a national approach, but those on the ground in Western Australia—with a magnificent track record—need to be kept in the loop. I understand that there is no company that is involved in exploration or production in Western Australia that wants to see this measure taken into account. I know that Woodside have not been out there pushing for it, and they are probably our most high-profile company at the moment.

Norman Moore, in a letter to the editor, has said that oil and gas projects cross boundaries between state borders, islands and mainland areas—and they do. There are a whole lot of boundary jurisdictions around who is responsible and how far out the zone goes. It is not a line like the offshore economic zone, which is 200 kilometres. It varies depending on the continental shelf and other factors, and islands and all those sorts of things. As he said, ‘I’ve had no-one knocking my door down to do anything about this.’

The Western Australian minister, Norman Moore, went further and said that to strip this regulatory responsibility from Western Australia and hand it to Canberra was something that he did not agree with. States would act as designated authorities and administer regulations regardless of whether the offshore operations were in Commonwealth or state waters. The current system is not broken and it has worked well for 50 years.

Coming to a conclusion, to demonstrate why we are concerned about this issue: there was meant to be consultation after a Senate committee, and I understand that the consultation has not been as forthcoming as it should have been. In talking to industry bodies today—this needs to be verified but it is information I have received from them today; we even talked to APIA today—to placate the territories and states, particularly Norman Moore, there appears to be some move towards saying that the minister in the state had the final say. If this is a move towards a resolution to this, that is good. But I would like to see it in the bill, I would like to see it in any part of the memorandum so that it can be referred to and held to account for any future contests in this area. As much as we support a strong national regulation—rather than a Canberra regulation—and the states having a proper say in this area, we support the bill.