October 8, 2009

Gas security critical issue for WA economy says Alcoa MD

On the 25th anniversary of the Dampier to Bunbury Natural Gas Pipeline (DBNGP) - one of the most important pieces of energy infrastructure in Australia – Alcoa of Australia’s Managing Director is calling for a greater focus on energy security and gas availability for WA’s domestic market.

Alan Cransberg, who will be a guest speaker at the DBNGP anniversary event, will caution Australia to get the balance right between expanding and maximising LNG exports, while ensuring the country’s own domestic needs are met.

He will use the anniversary forum to express his concerns about domestic energy security and gas availability in the State, and the criticality of the issue for the nation, state, industry, households and future generations.

“25 years ago the South West of Western Australia was changed forever with the arrival of natural gas as a result of the pipeline, and enormous economic opportunities flowed as a result,” Mr Cransberg said.

“Today, the challenges we face are remarkably similar to a quarter of a century ago – we need to ensure proper attention is paid to our own domestic needs and the needs of future generations when it comes to energy security.”

Mr Cransberg is calling for the Federal Government and State Governments to develop a national energy security strategy for the next 50 to 100 years, to ensure a vibrant domestic gas industry coexists alongside a vibrant LNG industry, and to ensure a secure domestic supply in a competitive market place.

He also believes three key issues are integral to achieving a secure energy supply in a competitive market.

“First, we need to bring new supplies of gas into the market. We’ve got to find ways to reduce barriers to market entry and to facilitate new players,” he said.

“Second, we need to ensure independence of selling arrangements for future gas projects - there are multiple buyers in today’s mature market and they need more choice.

“As new projects develop, there is a great opportunity for some of the world’s largest oil and gas producers to compete for serious business in Western Australia, just as they do in other countries all around the world.

“The third criteria for creating a secure supply in a competitive domestic market, is for the Government to implement policies that ensure we have sufficient available gas for domestic use.”

Acknowledging this is a complex area, Mr Cransberg said the three strategies are critical to enable competitive businesses to thrive and grow in Australia, to ensure households are well serviced, alongside a robust LNG industry.

He is also keen to acknowledge gas as a clean transitional fuel and an important piece in the greenhouse challenge while the way is paved towards renewable energy.

“There is no doubt that LNG exports are of great benefit to the WA community, but the community also benefits from local industries, and our local industries need diversity of supply, and to operate in an environment of competitive selling,” he said.

“Put simply, 25 years ago the need was identified for a secure domestic gas supply which resulted in the construction of the Dampier to Bunbury Natural Gas Pipeline and today we need to plan for an equally secure domestic energy supply, for the next 25 years and beyond.”

- ENDS -

Editor’s note:
Alan Cransberg will be a guest speaker at the 25th anniversary celebration of the DBNGP on Thursday 8 October at the Perth Convention Centre.

The DBNGP extends almost 1600km from the Pilbara region to WA’s South-West. It is one of the longest and largest capacity natural gas pipelines in Australia and connects the gas fields of WA’s North West Shelf to commercial and residential customers in the state’s highly populated South-West. 
For more visit: www.alcoa.com.au/cransbergsays

For more on Alcoa and energy visit: www.alcoa.com.au/energy