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Friday, 14 May 1920

Mr ATKINSON (Wilmot) .- The agreement has been very carefully considered by the Government, and, although I am not prepared to accept it precisely as it stands, I do not think there is any necessity for the appointment of a Select Committee. Nobody who has carefully read the agreement can say that it contains anything to suggest that the Anglo-Persian Oil Company is endeavouring to trick the Commonwealth Government. I consider that the agreement requires a little tightening up at some points. Rather more definition and clarity are desirable in certain respects; for example, in the matter of insuring thai the company shall draw its supplies, if and when available, from Papua, instead of seeking to carry on refining activities with crude oil imported from other parts of the world. In regard to capital, the agreement itself provides that an increase may be made at any time, and that the Commonwealth authority, no matter what changes may take place, shall still retain the 'balance of interest in the whole concern. I do not think a Select Committee is required to ascertain exactly what capital the business should begin with. In discussing the measure in Committee, the Prime Minister, no doubt, will be able to present such information upon that head as should satisfy honorable members; and necessary amendments can, of course, be made. It must be remembered, however, that whatever amendments may be decided upon must be submitted to the Anglo-Persian Company, seeing that it is a partner with the Commonwealth. I do not think there is any reason to suggest mala fides on the part of the company. I am satisfied that it will try to meetus upon all points.

I am very glad that this is an all-British agreement. It is time that the Empire became, in respect of one or two essentials, a little more self-supporting. In Australia, for instance, our iron resources need to be developed. The Government should do what they can to encourage the founding of an iron industry in Australia. The war has taught us that oil is a basic requirement, and we should do the best we can to obtain a proper oil supply within the Commonwealth. I hope that, before long, Australia will be supplying this company with oil, and that we shall have it refined here. Some people seem to think that the Government have practically handed over to this company the oil business of the Commonwealth. It is suggested that, under this agreement, we shall be practically in the grip of the company, which will be placed in the position of a monopoly. I cannot prophesy what may be the consequences of the agreement, but there is certainly nothing in it to suggest that it will lead to the establishment of a monopoly. It is open to any other company to come along to the Commonwealth with an oil proposition.

Mr JAMES PAGE (MARANOA, QUEENSLAND) - Not under this Bill.

Mr McWilliams - The best expert in Australia is opposed to the view of the honorable member for Wilmot (Mr. Atkinson).

Mr ATKINSON - I care not what experts may say. I have read the agreement, and am placing my own interpretation, upon it. There is nothing in it to prevent the Government .from helping any other company in Australia that has an oil proposition to submit. If I thought that by ratifying this agreement we should found a monopoly - if I thought we should be putting ourselves in fetters, and handing ourselves over body and soul to a monopoly - I would' oppose the scheme.

Mr JAMES PAGE (MARANOA, QUEENSLAND) - We shall kill the oil industry of Australia.

Mr ATKINSON - At the present time we have no Australian industry in oil.


Mr ATKINSON - The Bill will stimulate the development of oil production here. I fail to see why we should prevent any one from doing the very bestto produce oil and refine it in the Commonwealth. So far as I can see, there is nothing in the agreement that would have that effect. There is in the Bill a clause designed to protect the company from dumping. To that I take no exception. Under it, if the Standard Oil Company, or any other concern, enters into unfair competition with this company, the Government will come to the assistance of the local industry by means of the Customs or other Government agencies that it may need to employ. There is nothing wrong about that. Surely this Parliament will see that the Government protect the people in the matter of the price at which the oil shall be sold.

Mr Considine - Why stop at oil in that respect?

Mr ATKINSON - This Bill deals only with oil, and when I address the House I try to confine my remarks to the matter before the Chair. I see no danger in the provisions of the Bill relating to dumping. If this company helps to found the oil industry of Australia, and enables us to supply our own requirements, it will do good service. We must have some source of supply upon which we 'may rely, especially in time of war. Apart from the requirements of the Navy, the industrial world is daily increasing its demands for fuel and lubricating oils. Without this company we cannot at present supply our own wants. Even now we are in the hands of monopolies. The companies which supply us from abroad can make any arrangement they please between themselves. The honorable member for South Sydney (Mr. Riley) has quoted figures showing that in the United States of America petrol, benzine, and other oils have been very much cheaper than in Australia. The prices here are steadily rising, and there seems to be no limit to the price that kerosene may reach.

This agreement is of special interest to me, and I have scanned it carefully to see that it leaves the way open to other companies in Australia to secure governmental assistance if they can show that they are able to supply oils at cheaper rates. I am not at all satisfied with the way in which the Navy Department has been treating a Tasmanian oil company. There is in my own electorate a deposit of shale which, according to excellent authority, will produce 40 gallons of oil to the ton. The oil has been proved to be very strong and pure, and suitable for naval purposes. In Papua, we have found a very valuable oil, but it is not suitable for naval purposes. We have been importing oil for the Navy, and have been paying for it from £6 to £7 per ton. The latest figures supplied to me by the Navy Department show that it is now landing oil in Melbourne, in its own oil-tank steamer, at £5 0s. 5d. per ton. I dare say that, if these figures were carefully analyzed, it would be found that the cost is considerably more. Doubtless, no allowance is made for interest on the money invested in the oiltank steamer and for other incidental expenses, which should be included in a proper business calculation. The company which owns the Tasmanian shale deposits, to which I have referred, has offered the Government a contract for the supply of oil at £4 10s. per ton. The Commonwealth Government did, , on one occasion, agree with the State Government of Tasmania to accept 8,000 tons of this oil at £3 15s. per ton, but it has not been able to secure a renewal of that agreement even at £4 10s. per ton. Certain objections have been raised by the Navy Department. The company is prepared to try to meet them, and the Minister for the Navy (Sir Joseph Cook) told the Naval Board, in my presence, to prepare a contract and send it to the company in Tasmania, with the object of endeavouring to come to terms. The Naval Board, however, has done nothing. It continues to play with the company and its offer. The deposit of shale is a very large one, and we should do our best to encourage those who wish to develop it. The company are not asking for money. They say that if the Government would enter into a contract with them for the supply of oil, they would be able at once to raise sufficient capital to develop the industry.

Mr JAMES PAGE (MARANOA, QUEENSLAND) - When Mr. Jensen was Minister for Trade and Customs, did he not make the Tasmanian company an offer?

Mr ATKINSON - While he was Minister, the Tasmanian Government, which would have taken over the concern but for the action of the Upper House in rejecting the proposal, bad a contract with the Commonwealth to supply 8,000 tons of oil at a certain price. The company, as I have said, is now asking the Government to enter into another contract. It musthave some protection. Is it reasonable that it should be expected to go on the market and ask for more capital when, as soon as it started work, it would be open to the Standard Oil Company, or other foreign corporations, to enter into competition with it? The Standard Oil Company could afford to give oil away here for a year or two in order to defeat the local industry. By slightly increasing its prices in other countries it would not be out of pocket. Even if it were, it would not mind as long as it succeeded in strangling our industry. If we do mot come to the assistance of a local industry such as this, we shall fail in our duty.

Mr JAMES PAGE (MARANOA, QUEENSLAND) - This Bill will not help the Tasmanian venture.

Mr ATKINSON - No; but I see no danger in this Bill as long as the Government will do what they ought to do with regard to the Tasmanian company.

Mr JAMES PAGE (MARANOA, QUEENSLAND) - The Commonwealth Government is its only customer.

Mr ATKINSON - It merely asks the Government to enter into a contract with it for the supply of oil.

Mr JAMES PAGE (MARANOA, QUEENSLAND) - That is practically what every one wants. No one asks for more.

Mr ATKINSON - Not at all. Many companies approach the Government with requests for monetary -assistance for their ventures. We have reached a stage in our history when, in order to develop Australian industries, and so to improve our financial position, we must be prepared to take business risks. While it is our duty to see that the public funds are not foolishly expended, we must at the same time display business enterprise, since we need fresh sources of revenue to balance our accounts. Unless we develop the latent resources of Australia, we shall not balance the ledger. We have great possibilities of development - we have tremendous resources as yet untouched - and the war has piled up on us a war debt which, for a population of 5,000,000 to confront, is almost appalling. But, if twenty-five years hence we could show that we had developed Australia's national assets to the extent of £1,000,000,000, our balance-sheet would look very well. The history of industrial expansion in the United . States of America shows that such development is by no means impossible. Acountry is different from an individual. When an individual dies, his' assets are distributed in accordance with the terms of his will. A country, however, goes on for ail time developing its assets, and so adding to the general wealth of the community. The development of our latent resources is our great hope. Our industries must be expanded if the country is to carry a larger population and meet its heavy financial obligations.

I shall support the Bill, provided that satisfactory amendments are made in Committee. I believe that the Govern- ment willbe prepared to accept any reasonable amendment of the agreement, and I do not think there will be any difficulty in inducing the other parties to the agreement to accept such amendments made by us. I regret that the Minister for the Navy is not now present, because I wish to impress upon him the necessity of giving a little more encouragement to the Tasmanian company of which I have spoken. If it were asking for monetary assistance, I should appreciate some shyness on the part of the Government or the Naval Board. As it is, it merely asks the Commonwealth to enter into a contract with it for the supply of oil. It is said that if such a contract were entered into it would be able, within an hour, to raise in Melbourne the necessary capital for the development of its shale deposits. Even if this agreementbe adopted the refinery will not be in operation for about two years. I recollect the management of this Tasmanian shale company saying that if the Commonwealth would give a satisfactory contract the company could raise £150,000 immediately, and could be supplying fuel oil to the Navy within twelve months.

Mr Gibson - Surely the present prices of oil are sufficient inducement to any company to start work at once.

Mr ATKINSON - That would be true under ordinary conditions. But if anybody asked the honorable member to take shares in an oil venture in Australia he would immediately ask what protection the venture would have against the competition of the Standard Oil Company and other big trusts. And if he were told that there was no such protection he would withhold his capital. That is the position of this Tasmanian company, and indeed of every Australian oil venture at the present time. Unless the Government give assistance in the manner I have suggested they will not be able to found the oil industry in Australia in the face of the terrible competition of big overseas trusts. The Government would take no monetary risk in giving the contract that is asked for; if the company does not supply oil it will receive no money. If the Government found that by any such contract they were tieing their hands in regard to the obtaining of oil supplies for the Navy they could cancel the contract if at the end of six months it appeared that the company could not fulfil its part of the bargain. The Government have not done their duty to this company; they have not made sufficient effort to foster the oil industry in Australia.I hope that the Government will not regard this agreement as representing all that they need to do to foster our oil industry. The agreement is a very good arrangement so far as it goes. But the Government must keep clearly in mind that other people in Australia have oil propositions that are quite worthy of the closest investigation by the Commonwealth.

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