2017 Federal Budget brings new investment in Australia’s pipelines

It’s now more important than ever that the industry employs the highest quality services and equipment to ensure these new investments can reach their full potential.
Vermeer trencher on Australian gas pipeline

2017 Federal Budget brings new investment in Australia’s pipelines

Australia’s gas pipeline industry was a big winner in the 2017 Federal Budget, with major funding announced for the acceleration of gas development and studies into new pipelines. It’s now more important than ever that the industry employs the highest quality services and equipment to ensure these new investments can reach their full potential.

Josh Frydenberg, Minister for the Environment and Energy, said the Federal Government’s funding boost for Australia’s gas and pipeline industry is an effort from the Government to improve the “transparency, competitiveness and long-term security of Australia’s east coast gas market”.

Measures announced included $5.2 million to investigate the potential construction of two new gas pipelines to Moomba in South Australia, one from the Northern Territory and one from Western Australia.

Jeff Lawson, National Construction Equipment Sales Manager at Vermeer, said these investments have strong potential to boost Australian pipeline jobs.

“There have been challenges recently in regard to gas security and reliability so it’s positive to see investment in the future of Australia’s gas and pipelines,” Mr Lawson said.

“If these studies find the pipelines to be feasible, that’s a potentially huge boost for pipeliners. What the industry has to be doing now is making sure current projects are on track.

“This support from the Government is a great step, and makes it even more important for contractors and project managers to ensure their equipment is cost-effective and running as efficiently as possible, and that they are continuing to provide the highest quality services.”

APGA Chief Executive Peter Greenwood welcomed the funding measures and said they reflect the importance of Australia’s pipeline industry. He also highlighted that for the pipeline industry to thrive, so must gas production.

“It is important to remember that new pipelines will do little to address energy security if there is no new production to provide more gas into the system,” Mr Greenwood said.

“It’s important that the right balance is achieved between ensuring fair access to pipelines, and maintaining investment signals to allow pipelines to be built and expanded as new gas supply is developed.”

APPEA also supports studies into new pipeline infrastructure, and APPEA Chief Executive Dr Malcolm Roberts said, “Provided the business cases for new infrastructure stack up, APPEA welcomes more interconnection and further steps towards a larger, more integrated national market.”

The budget also allocated $28.7 million to the creation of a new East Coast Gas Development Program, which aims to encourage faster gas development for the Australian domestic market to improve supply and affordability.

Minister for Resources and Northern Australia Senator Matt Canavan said this is an investment towards Australian industry jobs, and is subject to the removal of current moratoria on onshore conventional gas developments, which are currently in place in several states.

“This program is an investment in the future of manufacturing and the future of Australian jobs. This new program will support projects that provide gas to domestic users and activities that accelerate gas supply from significant resources,” Mr Canavan said.

“The Australian Government will work cooperatively to encourage exploration and identify new gas supplies, but we expect the states and territories to show the same commitment to Australia’s domestic gas supply.”

Other gas and pipeline related measures in the budget included:

  • $19.6 million over four years to the Gas Market Reform Group to speed up reforms agreed on by the COAG Energy Council.
  • $30.4 million for a program to assess any potential impacts of unconventional gas projects on waterways and aquifers.
  • $2 million to the Australian Energy Market Operator to improve the publication of gas flows and market analysis.