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Friday, 22 May 1936

Senator Sir GEORGE PEARCE (Western Australia) (Minister for External Affairs) [7.37]. - I move-

That the bill be now read a second time.

The object of this measure is to appropriate a sum of £250,000 for the encouragement of drilling operations in connexion with the search for petroleum in Australia, and in the territories of New Guinea and Papua. The intention is that moneys appropriated for this purpose shall be made available by way of . loans to approved companies or persons on a £1 for £1 basis. In dealing with the applications for assistance, the Government will -be advised by a technical committee consisting of Dr. W. G. Woolnough, Commonwealth Geological Adviser; Dr. L. Keith Ward, Director of Mines of South Australia; and Dr. Arthur Wade, an expert with experience in many parts of the world.

Clause 2 of the bill defines the meaning of the word " petroleum ". In amplification of the definition, I desire to inform honorable senators that the provisions of this measure apply to petroleum or crude petroleum in a free state, to natural gases, and to solid and semi-solid petroleum. Natural gases are scarcely less important than flow oil itself. In other countries, large volumes are piped for distances of upwards of 1,000 miles for use as fuels in big industrial centres. Many of the wet gases contain sufficient petrol to make it economical to subject them to a process known as stripping, whereby a highly volatile petroleum is obtained in large quantities.

As the. result of slow and natural evaporation, and of chemical changes, petroleum which was originally liquid becomes solid or semi-solid. This petroleum forms substances including natural bitumen, natural tar, ozokerite and similar minerals, which have considerable commercial value, and, in some instances, are the sole outputof commercially important producers. Bituminous substances are used in road construction, whilst some others, such as ozokerite, yield the bases for the manufacture of lubricating oils, &c.

The search for petroleum has now been conducted in Australia and in the territories for a long period. Considerable preliminary geological surveys have been carried out, accompanied by some drilling, but the geological surveys are made far in advance of the drilling. Therefore, in the opinion of the Government, the time has come when special attention should be devoted to drilling. Geological structures may look favorable, but the only real test is that made by means of the drill. The major expenditure associated with the search for petroleum is that incurred in drilling operations. It is recognized that geological surveys are prerequisites to drilling and the technical committee to which I have referred will in all cases take full cognizance of the results of such surveys in dealing- with applications for assistance.

Some of the areas to which attention may be given include in Australia, the Carnarvon-North West Cape district and the Fitzroy River basin in Western Australia, the western portion of Queensland, including the Roma-Springsure and Longreach districts, the Hawkesbury RiverHunter River district in New South Wales, the Gippsland basin in Victoria, and possibly portions of central Australia ; in New Guinea the mandated territory north of the Sepik River, and , in Papua the Gulf and Delta divisions. There will, no doubt, be other areas in Australia and in the territories, but in this regard the Government will be guided by its technical advisers. The expert view is that districts possessing similar geological conditions to some of those which I have mentioned would, if existing in other parts of the -world, particularly in the United States of America, have been drilled many years ago.

Information in possession of the Government indicates that the prospects of finding well oil in commercial quantities are now more favorable than has hitherto been the case. The Government is determined to investigate every means of giving to Australia some independence in oil supplies. In this regard it has given attention to flow oil, shale oil and coal oil. The policy of the Government with regard to these three avenues of production was outlined by me in a statement which I made in the Senate on the 30th April last. At this stage I shall not say anything further on the matters dealt with in that statement.

It has been said by leading authorities that supplies of well oil in the United States of America are fast reaching the stage where that great country will no longer be an exporter of oD. No major oil field has been discovered there since 1930. I am not suggesting that a world shortage of oil is imminent, but merely emphasize that it behoves us, if we have oil within our territories, to bring it to production so that we may be able to fill the gap which would be created if the United States vacated the export field. In this connexion, I draw attention to a somewhat alarming statement published in to-day's press concerning the probability of the oil supplies in the East Indies becoming exhausted. Such a development would create a very difficult position for the British Empire. We all recognize what a boon it would be to this country if flow oil could be discovered in commercial quantities. It would add immeasurably to our prosperity and would enable Australia to carry a substantially larger population. In commending this measure to the favorable consideration of the Senate, I feel sure that it will be accorded the support which a proposal of such outstanding national significance merits. The transcendent importance of the measure needs no emphasis.

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