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Wednesday, 16 May 1973
Page: 2193

Mr KEATING (Blaxland) - At the outset of my speech I wish to congratulate the right honourable member for Higgins (Mr Gorton) on his remarks concerning this Bill. I could not help but notice his consistent attitude when he believes that the national Parliament ought to be asserting itself in establishing national priorities. His attitude towards the Territorial Sea and Continential Shelf Bill and his attitude towards the great national project proposed in this Bill are consistent. There seems to be a fundamental argument about the role of the Authority. The amendment moved by the honourable member for Farrer (Mr Fairbairn) suggests that the

Authority ought to be nothing more than a common carrier. The Government believes - and the belief is reflected in the Bill - that the Authority should be able to acquire and sell on a wholesale basis natural gas and petroleum products. The relevant section of the Bill appears under the heading 'Functions, duties and powers of the Authority'. It provides:

(a)   to construct pipelines for the conveyance of petroleum recovered from Australian petroleum pools to centres of population and points of export with a view to the establishment of a national integrated system of such pipelines, and to maintain and operate those pipelines;

(b)   10 convey, through the pipes operated by the Authority, petroleum belonging to the Authority or to other persons; and

(c)   to buy and sell petroleum, whether in Australia or elsewhere.

That provision describes the job envisaged for the Authority by the Government. The function of the Authority perhaps could better be explained by this analogy: The Authority will act as a primary reticulation authority. I do not think anyone would suggest that the Sydney County Council, which is the electricity reticulation authority in metropolitan Sydney, is only a common carrier for the Electricity Commission of New South Wales. The truth is quite to the contrary. The Sydney Council Council purchases power at wholesale rates and reticulates it to the metropolitan suburbs, to people living within Sydney. In the same vein, the proposed Authority will purchase natural gas and will convey it to the city gate, where other secondary reticulation authorities within a metropolitan region, such as the Australian Gas Light Co. in Sydney can take it over. While I am mentioning the Australian Gas Light Co. I would like to give great credit to the Minister for Minerals and Energy (Mr Connor) for defeating the obvious manoeuvre of the Australian Gas Light Co. which had planned to build a pipeline between Gidgealpa and Sydney. Eventually the Australian Gas Light Co. pipeline would have moved right across Australia, giving the company complete control of natural gas within the Commonwealth. The Australian Gas Light Co. had detailed plans to accomplish that objective. The initiatives of the Minister in respect of transportation and acquisition of natural gas have ensured that Australia's natural gas will be fairly and adequately distributed.

It seems we are always hearing from supporters of the Liberal Party moans and whines about any project they consider to be socialistic. Honourable members who were here many years ago would have heard similar moans about plans for the Snowy Mountains Hydro-electric Authority which was set up by the national Parliament to do a somewhat similar job in another resource. The critics said that it was an overly nationalistic project and would be too expensive. Yet time has proved that it was well within the capacity of the Commonwealth, as is the planned Authority.

In the United States there are about 170,000 miles of natural gas pipeline to serve a population of about 205 million people. Australia has a population of about 13 million people. On the basis of the ratio of pipeline to population as in the United States, Australia should have between 11,000 and 12,000 miles of natural gas pipeline, whereas only about 3,000 miles of pipeline is to be laid. Lateral pipelines are also to be laid, for instance, from the main pipeline to Orange and Bathurst, and from Sydney north to Newcastle and south to Wollongong. Pipeline is also to be laid from Albury to Melbourne and north to Brisbane. Taking all the laterals into account, about 5,500 miles of natural gas pipeline is to be laid. Clearly this is well inside the ratio which is evident in the United States.

The first stage, to be laid from Gidgealpa to Sydney, runs for about 780 miles. Originally it was to be constructed by the Australian Gas Light Co. through a subsidiary. It is to cost the Commonwealth between $180m and $200m, which is not a great amount in terms of the total annual Budget administered by this Parliament. The Snowy Mountains Authority was financed out of Consolidated Revenue. There is no reason to doubt that this proposed pipeline authority cannot be financed out of Consolidated Revenue. We have heard the figures of $ 1,700m and $ 1,800m mentioned as being the final cost of an integrated pipeline system in Australia. But that expenditure is spread over a number of years. If those costs were amortised on an annual basis, we would find it would be a fairly small outlay for the massive return that the people of Australia would receive.

It has been suggested by a number of Opposition members that the Government has no real mandate from the people for this program. This policy was mentioned by the Leader of the Australian Labor Party (Mr Whitlam) in his election policy speech and it is also incorporated at page 29 of the decisions of the 1971 Federal Conference of the Australian Labor Party. In the section headed Transport' at l.(h) it states:

Transmission of natura] gas by an interstate ring main to ensure continuity of supplies and uniformity of price.

As every member of this Parliament knows, the Labor Party, unlike the other parties, markets its policies in a platform that is freely available to the people. So, the people understood completely what the Labor Party had in mind in the area of natural gas and petroleum. We intend to see that our natural resources are not plundered and raped by private enterprise in this country and are not exploited for their own purposes.

Honourable members can look at the Australian Gas Light Co. as a classic example. Under the Australian Gas Light Act - a New South Wales Act - the Australian Gas Light Co. was permitted to make a profit which, I believe, was not to exceed 2 per cent of the long term bond rate. But the company established a subsidiary company to construct and operate its natural gas pipeline from Gidgealpa to Sydney. As I said earlier, the company envisaged that not only would it construct that pipeline but also a pipeline right across the Commonwealth. The company also priced the construction of this pipeline on an export potential, which it had no authority to do because the former Minister for National Development in the last Government, Sir Reginald Swartz, had stated on a number of occasions that no export of natural gas would be permitted until the reserves had been proven. Yet, the Australian Gas Light Co. was prepared to attempt to do this. This is just another reason why this sort of pipeline authority should be developed under the control of the national Parliament.

The right honourable member for Higgins said that he did not think that the pipeline authority should be able to make a profit. With an outlay initially of about $200m for the 780 miles, it is obvious that there must be some sort of return on investment and I believe that the Government envisages only a reasonable return. But it would be quite wrong to shackle the authority with provisions in this Bill, which will eventually become an Act, and so limit its whole area of operations. The real bonus with a national pipeline authority is that, if a comprehensive grid system is established, it would permit a lot of decentralisation within our country. As hon ourable members know, Australia is one of the most urbanised countries in the world, with most of our population centred on our 6 capital cities.

One of the great problems of decentralisation is to find an area which has the heat, energy and water and all the other essentials to establish a town, a city or an industry. Today, the password to the successful establishment of new towns is energy. If energy could be supplied at a uniform cost throughout the Commonwealth, regardless of location, then 1 think it would be a helpful and useful step towards decentralisation. As members of the Australian Country Party are always talking about decentralisation, I am sure that they would see the value of this Bill in the sense that it would provide cheap supplies of energy to decentralised towns.

In New South Wales many years ago, a Labor government introduced legislation for the uniform pricing of bulk electricity to all authorities within New South Wales so that small county councils were able to receive electricity supplies from the Electricity Commission of New South Wales at a uniform price. So, for instance, the Sydney County Council received its electricity at the same price as the Gwydir County Council or any of the other country county councils. Similarly, the authority proposed under this Bill will be able to supply natural gas at a uniform price throughout the length and breadth of the Commonwealth.

The amendment moved by the honourable member for Farrer does not deserve the support of this House. The amendment states: . . the Bill should be withdrawn and redrafted so that the National Pipeline Authority provides for Australia a public utility for the transportation at a fair price of petroleum on behalf of producers, distributors and users but so that the Authority may not be used as an instrument of nationalisation of the Petroleum Industry thereby inhibiting-

I do not know how it will inhibit - the search for and development of petroleum by private enterprise.

I do not think that that amendment holds water. Honourable members opposite talk about setting up this massive investment in an authority. But the authority will act only as a common carrier to carry the gas of some private company. After all, the gas belongs to the people of Australia, anyway. I think it would be foolhardy to restrict this Authority to the limits of an Act which did not allow it to purchase and. sell gas.

I will not weary the House for very much longer but I wanted to make one last point. One of the other values of a grid system is that it guarantees the supply of gas to all parts of the country. If a large vessel were to collide with one of the off-shore drilling rigs in, for instance, Bass Strait, it could cripple the city of Melbourne overnight. If the city were not interconnected in a grid system supplying gas from Palm Valley, Gidgealpa or any other source of supply within the region, we could ana that supplies of gas to a city or a region were restricted. If there happened to be an earthquake of even minor proportions, there could be an interruption of the supply of gas. This is another reason why this system should be integrated into a complete grid.

I believe the House should pay a compliment to the Minister for Minerals and Energy for his concept of a grid system. He enunciated in this House the concept of a grid system a few years ago and he was instrumental in having this provision written into the Federal platform of the Australian Labor Party. Now it has become a Bill for an Act and will become an Act. It will become one of the great national initiatives of this first Whitlam Government. So, I believe that, like the Snowy Mountains Authority and the other things he is doing such as establishing the national minerals and petroleum authority and other authorities, the Minister is laying the guidelines and the foundations for a comprehensive fuel and energy policy for the people of Australia, in perpetuity. I support the Bill.

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