PETROLEUM currently accounts for more than 50% of Australia’s primary energy needs, and with rising demand over the last year fuelling increasing production of both crude oil and natural gas, 2007 has been a year of structural change for the sector.
However, companies in the sector have performed strongly, with major players Caltex, Shell Australia, BP and Exxon Mobile Australia all ranking in the top 10 for total revenue for 2007.
Belinda Robinson, Chief Executive, Australian Petroleum Production & Exploration Association, said while oil prices, and to a lesser extent gas prices have increased, petroleum project costs have risen by more than 60%.
“Exploration activity for new oil and gas fields has increased in known areas but frontier areas remain under-explored,” Robinson explained.
“Consistent with trends around the world, the impact of increasing costs slowed the pace of Australian liquid natural gas project developments.”
Robinson cited other key issues affecting petroleum companies throughout year including skills and equipment shortages, high project costs and unnecessarily onerous regulatory and approval processes, but highlighted global warming as a major concern for the sector.
“This has led to a number of policy decisions around biofuels targets, renewable energy targets and the creation of an emissions trading scheme,” she told Manufacturers’ Monthly.
“Australia’s natural gas sector has a substantial role to play in assisting both Australia and the region move to a substantially less greenhouse intensive future, particularly through the supply of electricity generation.”
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