Oil and Gas Sector

Mr VAN HOLST PELLEKAAN (Stuart) (14:42): A third supplementary, sir, to the same minister: has the minister actually been approached by any of the other original unsuccessful tenderers throughout this whole process, saying that if they had been awarded this licence they would actually have undertaken exploration work?

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy, Minister for Small Business) (14:43): Anyone who is awarded a petroleum exploration licence is required to undertake work.

Mr van Holst Pellekaan interjecting:

The Hon. A. KOUTSANTONIS: Again, the opposition fails to understand the tactics of the division of petroleum within State Development to attract international players to the Cooper Basin. The reality is that for us to grow our unconventional gas reservoirs, to convert our natural advantages into investment, we need to create an opportunity for international mergers and acquisitions, we need to create joint ventures, we need to have foreign direct investment here in South Australia—and the foreign direct investment we want is people who have experience in unlocking unconventional gas.

I know the opposition's view on exploration of unconventional gas is about stopping it, but we are about trying to encourage it. We want to see more exploration, we want to see more investment, we want to see more international companies, especially US shale companies, invested in South Australia. Why? They bring with them expertise. Why? They bring capital. Why? They bring prestige. Of course, what they also bring is knowledge, they bring markets. Of course, we know that this industry is one where deals are very, very important. Places like APPEA are a very good opportunity for deals to be done, but what we need is an international focus in this state.

The oil price is at record lows. We have seen South Australian companies' share prices halve. We have seen a lot of investment at risk. What we need to do is to create a regulatory environment that is bipartisan, to encourage as much as we can, to have as many international companies think that South Australia is a good destination to come and invest in. Unfortunately, I have to say that that bipartisanship which was once available is fast eroding, and I urge the opposition to regain that bipartisan spirit which they were offered when we were in opposition during the drafting—

Mr Bell: Bipartisan when you need it.

The SPEAKER: The member for Mount Gambier is living on the edge.

The Hon. A. KOUTSANTONIS: Yes, sir, he is. I urge members opposite to think about the consequences of their words and their language. These are words that can never be taken back. When the opposition talk about inquiries into unconventional gas, when they talk about—

Mr KNOLL: Point of order, Mr Speaker.

The SPEAKER: Point of order.

Mr KNOLL: The minister is not responsible to the house for the opposition.

The SPEAKER: The minister is comparing and contrasting policies. Unless he goads the opposition unmercifully and makes the opposition the principal target of his remarks, he may continue.

The Hon. A. KOUTSANTONIS: Thank you, Mr Speaker. A wise judgement, sir—very wise judgement. My view on the oil and gas industry is that it needs to be nurtured. It is a vulnerable industry—high risk, high reward. A lot of the wells that they drill come up dry. They spend a lot of money and a lot of time trying to unlock very valuable resources, and sometimes that is unsuccessful. I think what the industry looks for from government is an acknowledgement of the risk this industry takes.

I have to say that the questions that are being asked of the government bring into doubt the bipartisan spirit we once had about this industry, because members opposite know I play absolutely no role in the awarding of PELs. That is done independently of me, as it should be, because the opposition at the time—the then Labor opposition—and the then Olsen government agreed on a petroleum and geothermal act that had that very clause in there: the ability to delegate the option to have bids assessed by experts, not by the executive.

The SPEAKER: I warn the minister for ironical toadying. The member for Stuart.