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North West Shelf gas project: government's decision to forego royalties



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THE SENATE

SENATOR PETER DURACK, Q C DEPUTY LEADER O F THE OPPOSITION

PRESS RELEASE i n t h e s e n a t e

SH A D O W MINISTER FOR RESOURCES A N D ENERGY

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Although the Opposition acknowledges the enormous importance of the North West Shelf gas project to Australia, many questions need answering before it will be possible to make a proper

judgement of the Commonwealth Government's decision to forego royalties. B

It is simply not clear from yesterday's statement by Resources and Energy Minister Evans whether the decision is fiscally responsible or whether it will ensure the commercial viability of the project.

-The FederalĀ· Minister refers to "huge budgetary strains" which would have been placed on the Burke Government but despite widespread speculation no details have been provided as to the extent of the State's liability under the existing take or pay con treict,

It was clearly necessary for the Commonwealth Government to play an active part in sorting out this major threat to the Nation's good standing and to the future of this major development project.

But the Federal Government has already provided major tax concessions to this project and yesterday's decision amounts to a further significant contribution by Australian taxpayers.

W2uldJ L have been so generous to a West Australian government of a different political persuasion?

Would it have been so anxious to help if the present embattled State Labor Government was not facing an election in the next twelve months?

The most unsatisfactory aspect of the announcement is the total silence about what contribution, if any, the West Australian Government has agreed to make towards salvaging the project.

All we have is a vague promise by Minerals and Energy Minister Parker of a statement within a few weeks. This adds insult to the as yet unknown injury to be suffered by West Australian

taxpayers.

Other important considerations include the fact that the State Government has clearly brought pressure to bear on the joint venturer to accept a reduced price for their product despite

a firm contract entered into with the former West Australian government.

That could have serious repercussions for the State and indeed Australia's standing in the commercial world and the public is entitled to know more details of this aspect of the arrangement.

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Perhaps the prime lesson to be learnt from the whole exercise is the. undesirability of governments involving- themselves in commercial, undertakings-.

If they do meddle, their, electors: must realise that, as taxpayers, they will be just as liable, f or. losses incurred as for. elusive profit earnings.

This isĀ·- particularly relevant, for West Australians given the Burke government's great propensity to involve itself in commercial, ventures.

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PERTH

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