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Thursday, 28 September 1972
Page: 2140


Mr CONNOR (Cunningham) - I support the terms of the subject before us. The honourable member for Lalor (Dr J. F. Cairns) referred to the strong words oi' Sir William Pettingell. They call for strong words in reply. I speak for a steel city where there are 2,004 registered unemployed at the present time. 1 speak for an area where the steel workers have world production records, which performance they have achieved repeatedly. T speak for an area where steel can be produced cost competitively with any other part of the world. In fact, we can even export steel to the east coast of the United States in competition with Japan. I speak for an area which is capable of producing world quality steel. I speak for an area where people literally are amazed to be told that they are not capable of constructing a pipeline.

The Minister for Customs and Excise (Mr Chipp) referred to this exercise as being ludicrous. He can laugh off these facts. The loss of this contract means loss of employment for 260 men who would be engaged directly in the fabrication of the pipe, lt means loss of employment for one year to the equivalent of 1,000 men who would be producing the steel. It means loss of employment to 300 coal miners who would be producing the coal for the project. Those are the facts.

As far as quality is concerned, let me put it this way: Sir William Pettingell did not want to be satisfied, and the bar of the high jump was progressively raised. It did not matter what requirement he stated and that was met, he did intend to give the contract to the companies concerned. I am not interested in their feud; that is a matter to be fought out between the companies. But 1 am interested in the slur and the stigma on the Australian steel industry. As for the utter tripe about the safety of pipelines and their standards of service, let me remind the House that of the 480 miles of the 24-inch pipeline from Adelaide to central Australia, 240 miles came from the Port Kembla area. It was manufactured by Tubemakers of Australia Ltd, and there has been no trouble whatever with that pipeline. The whole of the Dongara to Perth 14-inch pipeline is coming from Port Kembla. The 110-mile pipeline from Bass Strait to Melbourne, half of which crosses land, again came from Port Kembla, and there has been no trouble with that. But the other 55 miles of Japanese pipeline gave trouble and sections of it had to be replaced. It is utter nonsense to talk in terms of standards of service.

Again on the aspect of quality, let me say that there has been a Jot of technology thrown around behind the scenes. In the first place, the methods of producing steel were queried. It was suggested that the rare earth process to be used at Port Kembla was not satisfactory to the AGL technicians. As a matter of fact, if any of the Ministers concerned would like to look at a journal known as 'The Pipeline and Gas Journal' they will see on page 45 of the issue of July last an advertisement from Nippon Kokan Steel Co., one of the 3 steel firms which is to fabricate this pipe, advocating and boasting of using this rare earth process - using a substance known as cerium. The alternative process and at a different stage of steel production - this is used by Japan - is the use of soda ash or, as the chemists call it, sodium corbonate.

The Australian Labor Party has a policy in regard to this matter. We consider this to be merely the first round of a battle for the control of Australia's major natural resources. We have world ranking supplies and both Japan and America are lined up to get them. The Australian Gas Light Co. wanted to impose the maximum that it could on Broken Hill Pty Co. Ltd, Australian Iron and Steel Pty Ltd, Tubemakers of Australia Ltd and the other subsidiaries. We are not their protagonists on this occasion but we know the implications, so do the men at the Port Kembla steelworks and in the different trade unions which have decided to take action, and take action they will. It is significant that the Port Kembla waterside workers in 1939 had sufficient patriotism and foresight to ban, or attempt to ban, the export of pig iron to Japan and to dub the then Prime Minister 'Pig Iron Bob'. The ironworkers at Port Kembla today are talking in terms of 'Pipeline Billy', and justifiably so.

Australia can make anything which any other section of the steel industry in the world can make today. As to making a 34- inch pipeline, it can be made. Tubemakers was not given the opportunity to do so. It submitted a tender on the basis of a 30- inch pipeline and was never invited to submit a tender for a 34-inch pipeline. As to the quality of steel, Tubemakers submitted a special type of steel known as X65. For a period of 12 months metallurgists and other technicians at the AIS plant at Port Kembla were perfecting this type of steel and it will fully meet the requirements. A slur has been cast by Sir William Pettingell on the capacity of the Australian steel industry to produce. This order happens to be the largest that has ever been submitted to Japan with the exception of one order, and that was for the Alaskan pipeline. As a matter of fact, Japan had to farm it out amongst 3 groups one of which will be using the very process for sulphur elimination that AGL chose deliberately as a ground for rejecting the tender of Tubemakers. What is the Minister's answer to that? We know a good deal about steel technology and that is more than the Government can say. It does not want to know the truth in this case.

As the honourable member for Lalor has said, anything up to 20,000 miles of pipeline will need to be manufactured. There needs to be a continuity of supply. There needs to be some basis on which we can plan. I have been informed that it is estimated that for $300,000 the Port Kembla steelworks could re-tool its production system and could definitely produce a 34-inch pipeline. The works has a world ranking steel rolling mill which can roll steel up to 142 inches in width. After trimming the works can produce steel pipe up to 42 inches in diameter. Sir William Pettingell has literally slammed the door in this Government's face. In his statement to the Australian Gas Association conference yesterday he said he does not want it. He is pretty bitter about it. I know that the Government is embarrassed and that is the reason why the Minister for Customs and Excise (Mr Chipp) has chosen airily to try to push it to one side. The only question that the Government is prepared to consider is how it can weazel out of the responsibility of imposing a 35 per cent duty.

There is a bigger point at stake. The pipeline to Gidgealpa is just the first step in a further progression to Palm Valley, and that is the glittering prize. We want to know the full facts. The Minister in answer to a question I asked last Tuesday refused to put the full facts before the House. We are entitled to know. This is not a matter of commercial judgment; this is a matter of national responsibility. This is the national Parliament. This is a people's asset. We are entitled to know the terms on which this is to be sold, the specifications and the truth of the matter. One of the 2 major protagonists is telling a lie. We have a pretty shrewd idea which one it is, and equally we have a pretty shrewd idea that the Government has deliberately set out to protect it. This Government ought to be ashamed of itself for its attitude in this matter. It is painting itself into a corner. It is traducing and vilifying the Australian steel industry and, more than that, it is trying to tie the hands of an incoming Labor government. But irrespective of anything that this Government does, we will have our say in this matter.

As to the ability of the Australian steel industry to produce the steel in the time required, the contract period was deliberately shortened. The route for the pipeline has not yet been finalised. The notice that has to be given under the terms of the New South Wales legislation ends at Orange, and it is from Orange to Sydney where the trouble really starts. Delhi, one of the consortium at Gidgealpa, is bucking on the question of price, and rightly so.







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