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Tuesday, 3 April 1973
Page: 968

Mr CONNOR (Cunningham) (Minister for Minerals and Energy) - There is one thing of which the honourable member for Farrer (Mr Fairbairn) can be certain. It is that there is in office today a government which will take a truly national viewpoint, which will not grove), which will not play a subordinate role, which knows just where it is going, and which above ali has a policy and will put it into operation. The honourable member for

Farrer, of all people in this House, should bo very reluctant to criticise. I have here a manual prepared by my Department giving the terms on which off-shore drilling for oil and natural gas is carried out in 50 countries. We rank 49th among them, thanks to the honourable member for Farrer, the former Minister with responsibility in this area. The legislation which was put through during his term of office was administered in the most slovenly possibly fashion by an incompetent, irresponsible government - a so-called government of businessmen. We have heard today a jeremiad from the honourable member, who ought to be ashamed of himself.

Let me refer to the facts when I came into office, and I came in with a mandate to evaluate and secure the balanced development of Australian mineral resources for posterity. I found that even the slack, slovenly legislation, the Petroleum (Submerged Lands) Act of 1968, had not been properly administered by either the former Minister or the designated authorities. In certain cases 1 even had to threaten to cancel leases to get information to which we were entitled, information that was 3 years in arrears. Wells had been drilled and proven but no information had been given - a nice cosy arrangement in certain cases between some of the States and particular exploration companies. The honourable member for Farrer is the man who is responsible for it, and let him deny it if he can.

As to the true situation, there is no question of paeans of praise coming from the honourable gentleman. Table J 8 in the Treasury White Paper on Overseas Investment in Australia shows that in 1968 no less than 58 per cent of Australia's minerals were under foreign ownership or control. A reasonable and conservative extrapolation from those figures is that today the proportion is of the order of 62 per cent. We will do something about it. We will see, to begin with, that it does not get any worse. Wo will see also that there is a policy which is in the interests of Australia.

I found also that, so far from being a businessman's government, the former Government had not done its suras. In Japan we are dealing with one of the most numerate, sophisticated, literate and competent countries in the world, and we need to be just as well geared and just as well prepared for trade as Japan is. Instead of that, what did I find? I found no records at all. There was no idea of business competence on the part of the previous Government. No statistics were kept, beyond those of 1968 that I have just quoted. No records were kept of the export prices obtained. There was no idea whether we were getting world parity prices or somewhere at least close to it in respect of export contracts. No research had been done and no records kept as to what was the denomination of currency payable under export contracts and particularly how many of those contracts were denominated in United States dollars. There was no idea of the period of the contracts and no idea as to whether there were any protection clauses in respect of currency revaluations. This was from a so-called businessman's government. Australia is the twelfth trading nation of the world and I am ashamed that our dollar, which is a good and a strong currency, is not accepted in the bourses of the world. Again, that is due to the then subservient government which was tipped ignominiously and unceremoniously out of office.

The honourable member for Farrer also referred to the Japanese. I think we have every reason to ask Japan to renegotiate current contracts. As a matter of fact, the advantage to the Japanese is as much as 26 per cent, according to the Smithsonian Institute, because of the December and February revaluations. We have every reason to look them in the eye. When the contracts for iron ore exports had to be renegotiated and Australia was asked by Japan to curtail some of its exports, we agreed to do so and now it is our turn to ask them. Shame on the honourable member for Farrer for suggesting that we should not go along to the Japanese and ask them for a fair deal. One cannot get better iron ore or minerals and better certainty of supply and sanctity of contracts than from Australia, irrespective of which government is in power.

This Government found it necessary to impose export controls. Because of our archaic Constitution, there was no other way of obtaining data that we needed to enable us to become as sophisticated and well-informed as the Japanese. They know a lot more about our business and mineral industry than we know about them and it is time we improved our performance. We will do it and do it in every field. Let us take the case of the Queensland coal export industry. There we have the rape of resources. The former Government is responsible for it. It gave export permits under leases for open cut coal mines and said: 'You can have them at any price you like'. Far from this Government being criticised for its actions, I have a letter from the President of the Queensland Trades and Labour Council in which he informs me that Utah Mining Australia in particular is very glad of the new policy which has been introduced.

I turn now to offshore oil exploration and refer to the case of the Woodside-Burmah company. It was necessary, under pressure from the former Department of National Development, for my predecessor in office to write to Woodside-Burmah and inform the company that it was time it made some public statement about its recoverable reserves of natural gas and, reluctantly it did so - very reluctantly indeed. My predecessor also stressed that he was afraid of the diminution of their Australian share holdings. The manipulation is still going on. I notice that, in the last couple of days, there has been a further downgrading of the recoverable reserves of WoodsideBurmah. This Government has a very shrewd idea of the reserves of this company and it has an equally shrewd idea of the reserves of oil and natural gas in Bass Strait. Even in the case of Bass Strait, the Government has not been getting the information to which it is entitled, such as information on drilling cores, sections of cores and electric logs. In many cases, weekly, monthly and quarterly reports have not been received. We have had to ask the companies concerned for this information. We have had to threaten drastic action to get them, but get them I will.

Another matter that the honourable member for Farrer evidently forgot is that today there is a world energy crisis. There was not one word from the honourable member about this matter. Australia in particular will be the subject of the resources diplomacy of both Japan and the United States. Those countries have exhausted their resources of energy and now, through the Organisation for Economic Co-operation and Development, they are in the process of trying to put Australia through the wringer. But we will have a policy which we will put into operation. It will run along these lines: Just as every well-managed country has an annual financial budget, so we will have an energy budget. But we will have a proper mix as to the various sources of energy and as to what will be made available and what, if any, we can export overseas. The philosophy of the former Government was simple: If it moves, shoot it; if it grows, cut it down; and, if it is in (he ground dig it out and flog it, particularly if it is minerals, for whatever price can be obtained for it. lt is time Australia grew up and took its proper place and it will, under a truly national government.

The future of the world - there is a world hydro-carbons crisis - will be determined by the possession of coal reserves. No less a person than Mr Wagner, the President of the Royal Dutch-Shell company, said 6 months ago that, within 40 to 50 years, the whole of the world's hydro-carbon resources would be exhausted. He spoke in terms of crude oil and natural gas. Then, for the future, he said the world would be dependent upon coal resources, uranium and solar energy. The previous Government did nothing in any of those fields. Its policy was rip it out and rape it and sell it for the best price that could be obtained for it. But as for achieving anything constructive, the former Government was the most incompetent government that has ever held office in Aus tralia.

Our policy on exports is clear; it is a policy of benevolent surveillance. The policy is working well. All applications as and when received are processed and dealt with immediately. There is no reason for complaint. The honourable member for Farrer rushed to the defence of quite a number of his friends who are leaders in the mining world. Some of them are very estimable gentlemen but, in many cases, they are completely unsophisticated. I do not want to betray confidences, but I shudder to think what is the position of some of these major firms at present because they did not have the nous - and nous is the word - to heed warnings which were there for all to read and to hear. I can only repeat my answer to the honourable gentleman's question of last week. It is a simple answer. Since 1958 it has been well-known that the United States dollar was on the downgrade and it has been progressively on the downgrade ever since. Today - I will say this for the Japanese - neither the Japanese nor anyone else in the world knows just where the United States dollar will finish. For that reason, it is difficult to do better than to negotiate short term contracts or to ask for contracts to bc renegotiated and relief obtained on that basis. For the future, there will be firm government. There will be firm dealing and we will be respected for it. If one were to ask some of the governments of the world today what they thought of our predecessor, it would be found that they held them in contempt. The previous Government was weak, slovenly and incompetent. There could not have been a more unbusinesslike administration in world history than the previous Government.

In conclusion, I should like to make another point. In the future there will be no giveaways of kingdoms, empires or principalities in regard to off-shore mining. We have a mess to clean up and again, it is a mess of the honourable member's making because it was he who made that celebrated deal when the previous Government, which originally favoured the particular system under which Australia would have received some 40 per cent of the take from proven petroleum and natural gas areas, and sold Australia's birthright for a mess of pottage. The honourable member for Farrer actually increased the royalty payments from 10 per cent to Hi per cent in return for abandonment of the graticular system. That was a fair example of a businessman's administration. We reject this discussion of a matter of public importance with contempt - a contempt it deserves. There will be other speakers who will deal with other aspects of what the honourable member for Farrer had to say, particularly with regard to exchange revaluation.

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