THE CHAMBER of Commerce and Industry in Western Australia has sided with Woodside in a review into the state’s gas sector which paints a bleak picture if gas supplies are jeopardised.
The review undertaken on behalf of CCIWA and developed with input from independent consulting firm Australian Venture Consultants highlighted the competitive advantage of the state’s gas supply, showing it directly supports billions of dollars of mining projects and heavy manufacturing, while making electricity cheaper and more reliable.
It found that in a “worst-case scenario” a reduced gas supply would slash the state’s economic activity by up to $42 billion.
It predicts a $2.9b cut to government revenue and foreshadows job losses for up to 45,000 workers.
The review included a survey of 853 WA businesses and found that more than half (51%) directly relied on gas to operate, beyond the use of grid electricity.
CCIWA Chief Executive, Peter Cock, said the work highlights the need for a regulatory regime and political consensus which supports investment in gas developments.
“We simply cannot afford to sleepwalk into a gas crisis,” he said.
“Natural gas is the lynchpin of our economy, so it’s time for a fact-based debate on the essential role it plays in WA’s economy today and what the impacts would be if we don’t support further investment in gas supplies for the future.
“This review shows the critical role gas plays in WA’s mining sector, from powering the machinery that extracts minerals, to processing, milling and smelting.
“Without affordable and reliable gas supplies, WA’s mining sector would simply not be able to operate as it does today,” Dr Cock said.
“Even a modest drop in gas supplies would put significant pressure on mining operations, which would make it more difficult for Australia to maintain its world leading status as a reliable supplier as well as compete with emerging mineral markets.”
It also highlights the critical role gas plays as a direct feedstock in chemical manufacturing for things like fertilisers, as well as in the creation of construction materials like bricks and cement, and in food and beverage production.
“A reduction in gas supply for WA wouldn’t just be an inconvenience – it would cause significant economic and social damage,” Dr Cock said.
“If WA’s gas supply is jeopardised, the impacts would be felt right through the WA economy, impacting the job security and prosperity so many of us enjoy today.”
Dr Cock also pointed to the role WA gas could play in helping other countries in the region to decarbonise.
“Countries in Asia are looking to reduce their reliance on coal but, at the same time, their economies are growing and so are their energy requirements, which increases their appetite for gas,” he said.
“WA is in the box seat to capitalise on this demand, while at the same time contributing to global emissions reductions given gas has around half the lifecycle carbon emissions of coal when producing electricity.”
