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Tuesday, 31 October 1967


Mr IAN ALLAN (Gwydir) (12:24 PM) - I do not intend to speak on this legislation in a parochial fashion as the honourable member for Corio (Mr Scholes) did, or even in a State sense. I want to speak about it in a national sense. Discoveries of natural gas have been made recently ofl the coast of Victoria and more limited finds have been made in other parts of Australia. There is no reason to doubt that we will continue to make discoveries. I regard this matter as being entirely national in character. We must regard it as such irrespective of the particular desires or interests of any State at any particular time. It is a national question.

Treating it as such, I am sure that the pattern in Australia will follow closely the pattern of development established in other countries in which natural gas has been discovered and used for industrial purposes. Canada, for example, a country comparable to Australia in many respects, has multiplied the discovery ' and usage of natural gas fourteen times in the last 12 years. The Union of Soviet Socialist Republics is using sixteen times as much gas now as it did 12 years ago. The United States of America, where discoveries of oil and gas have been quite remote in time, has doubled its usage of natural gas in the last 12 years. There are forecasts that the network which supplies natural gas throughout the United States of America will be increased in mileage by a third in the next 10 years, such is the demand for this new commodity in that country. Natural gas in the United States now supplies more than a third of the total energy needs of the nation as against little more than a quarter 10 years ago.

This being the pattern in other countries which are in many ways comparable to Australia, I believe it reasonable to forecast a similar progression in this country. We can expect further discoveries of natural gas and a greatly increased demand for it in Australia. Therefore we must plan the provision of a network of pipelines to meet this need wherever it arises. It is in this regard that I think there is need for national planning. I was interested to see a slight difference in attitude on this regard between the Minister for National Development (Mr Fairbairn) and the AttorneyGeneral (Mr Bowen).

I think it reasonable that the Commonwealth should establish a commission to control the reticulation of natural gas throughout Austrafia, particularly as some States have forecast that they will be using public money to construct these pipelines while others have forecast the use of private moneys. In eider to co-ordinate this construction I think it would be useful for the Commonwealth te establish a national commission as a co-ordinating authority. I was interested to see in the annex to the Agreement between the Commonwealth and States relating to this Bill that the Commonwealth and the States have agreed that:

.   . they will encourage and will not seek to restrict any such trade

That is, trade between the States: and with that in view they will confer from time to time as any of them requests. They declare their common intention not to discriminate against any such trade.

I think that that is a positive statement. I think it justifies the Commonwealth establishing a commission to control the reticulation of gas throughout the States and the Australian Capita] Territory. But I find that the Attorney-General, when speaking about this Bill, regarded it in a rather different light. He said:

If contrary to the memorandum a State broke the understanding, such action would entitle the Commonwealth to move in and use its constitutional powers.

This is looking at the matter from the other side of the coin. The Attorney-General says that we can move in as a Common wealth only if a State breaches the terms of this agreement. I would have thought that the understanding or the Agreement stood on its own; that it was a positive statement. However, I will not pursue this matter. I am not a legal authority, but to my mind there is a certain conflict between the Minister's words and those of the Attorney-General in this connection.

Whatever the rights or wrongs of the matter are, I am sure that there is a need for planning. For example, the provision of this cheap form of energy which can be transported so cheaply throughout this nation provides an ideal means of encouraging decentralisation. No State - all States say that their finances are limited - will really encourage the reticulation of gas to out of the way country centres unless it can be absolutely sure that it will get a return on its investment. No private entrepreneur will build a pipeline to some small hamlet unless he can be absolutely certain that he will get a reasonable profit from his outlay. So somebody must induce the private entrepreneurs to act by giving them a financial concession. Somebody must induce the States to embark upon reticulation, which would be uneconomic initially in this form, to encourage decentralisation and the establishment of industries in small country centres. Nobody is better fitted to do this than is this Government. As for the cost of this energy in other countries, I do not take rauch notice of the remarks of the honourable member for Corio (Mr Scholes). I confidently believe that there will be some competition in this field between the States as discoveries take place in different parts of the Commonwealth.

Let me give some details as to the cost of energy transmission in the United States. I quote from 'The Australian Chemical Processing and Engineering Manual 1967'. lt states:

The best coal-fired steam-electric operation corresponds to 81.35 per million Btu at 95% load factor with $4.50 per ton coal and fixed charges of 14% . . . Compare this to the average US city gate price for natural gas of 34 cents per million Btu . . .

Transportation of electrical energy in the most advanced extra high voltage transmission system, with private financing, will be typically g cents per million Btu per hundred miles for a long, high-capacity d.c. line, to 10-12 cents per million Btu per hundred miles for typical a.c. lines.

This compares to gas transportation costs of 1.5c per million British thermal units for 100 miles - a comparison of from 10c to 12c for electricity with 1.5c for gas. There is a very striking difference in the cost of energy as between electricity and gas in the United States. There is very little reason to suppose that a similar difference would not exist in this country if we were to reticulate gas in the same way between centres as has been done successfully in the United States.

I ask the Government to look closely at the need to establish a national pipelines commission to co-ordinate the reticulation of gas from discoveries off the coast of Tasmania or Victoria, or wherever gas is discovered throughout Australia and to make sure that the gas supplies are made available to likely growth centres in the interior. I refer to places which have a potential for future development and growth of industry and population. Only the Commonwealth Government can finance such an operation. I am sure that the Government should establish and has the power to establish a national commission for this purpose.







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