Oil and Gas Sector

Mr HUGHES (Giles) (14:37): My question is to the Treasurer and Minister for Mineral Resources and Energy.

Mr Pengilly: Don't get expelled again, Eddie.

Mr HUGHES: I will try not to. Minister, can you advise of any recent developments in the oil and gas industry in South Australia?

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (14:37): The oil and gas sector is a vital part of our economy here in South Australia, both in its own right as a major employer but of course in the provision of energy to households and industry, domestically and internationally.

Today, an Adelaide headquartered company, Beach Energy, has announced that it has reached agreement with Origin to acquire Lattice Energy for $1.5 billion. I will leave it to Beach to comment on the details of the transaction, but I draw to the house's attention to the significance of this acquisition—acquiring Lattice for more than double the assets held by Beach, expanding its presence from the Cooper Basin and extending its reach to Australia's east and west coasts, as well as in New Zealand.

Beach expects its production to increase by some 150 per cent and its portfolio to diversify from a focus on one petroleum basin to five. The Cooper Basin will remain its largest asset focus, with Beach bringing the Lattice assets in the Cooper Basin under its wing. Beach is now expected to supply about 15 per cent of the east coast gas demand. The Beach Energy acquisition is a further demonstration of the influence and strength of the South Australian-based listed companies. This acquisition will add to the scale and momentum of the mineral resources and energy sector in this state.

Lattice Energy, which was spun out of Origin, has assets in Perth, Otway, the Bass Basin in Australia and the Taranaki Basin in New Zealand. Beach's acquisition will create new opportunities for contractor companies in the oil and gas sector to offer their services, building on the existing relationship they have with Beach. We are home, as a state, to Santos, OZ Minerals, Iron Road, Hillgrove Resources and a raft of junior miners and explorers that employ South Australians and support business opportunities in this state.

Add to that list earlier this month Strike Energy, which moved its headquarters from New South Wales here to South Australia to progress its southern Cooper Basin project. It is no accident that these companies are choosing to relocate from the east to the south because of the investment profile and commitment we have to this sector as a government. This government is pro the oil and gas sector and pro business.

From 1 July next year, we will be the only state jurisdiction where acquisitions of this sort will attract no stamp duty, no liability on the transfer of property: on the land, the buildings, the plant and equipment, the intellectual property or the licences of production for minerals and petroleum. These settings encourage business transactions, helping to grow our economy, enabling business to keep employing more South Australians. The government wants to do more to encourage more gas out of the ground to underpin our economy and ease pressure on energy prices.

To quote the Prime Minister, 'The recent rises in the cost of gas are the single biggest factor in the current rise in electricity prices.' The Prime Minister has urged for energy policy to be guided by engineering and economics, not by ideology and idiocy—his words: ideology and idiocy. How painful must it be for the Prime Minister to gaze at the errant relatives of the federal Liberal Party, the idiot sons of the Liberal Party.

Ms Sanderson interjecting:

The SPEAKER: Point of order.

Mr VAN HOLST PELLEKAAN: Standing order 98.

The SPEAKER: Yes, I uphold the point of order, and I warn the member for Adelaide for the second and final time.

The Hon. A. KOUTSANTONIS: The South Australian economy is growing at a healthy and sustainable rate. Last financial year, our gross state product grew by 2.25 per cent, outpacing the nation's GDP growth of 1.9 per cent. Beach's acquisition of Lattice will add momentum, and I congratulate the company on their acquisition. If we followed the advice of the Leader of the Opposition, we would have to slow our economy down.