Gas Exploration

Mr HUGHES (Giles) (14:55): My question is to the Minister for Energy and Mining. How is the state government supporting exploration for gas in South Australia?

The Hon. A. KOUTSANTONIS (West Torrens—Minister for Infrastructure and Transport, Minister for Energy and Mining) (14:55): The first thing to do is not ban it like members opposite did. Our priorities reflect public and industry concerns about energy prices and the fears of domestic gas shortages and the role of gas and exports in influencing prices in the National Electricity Market.

There is a tension between domestic supply and international prices, and banning local exploration doesn't help that. Local consumers will need to be resolved in the way that benefits all South Australians to make sure they have access. Of course, the Heads of Agreement signed between East Coast LNG Exporters and the Australian government, which commits an extra 157 petajoules of gas to the domestic market next year, will alleviate some of those supply concerns that have driven recent market behaviour, but of course it won't impact price.

However, as a state we also have a role to play to ensure that our local gas supply has every advantage to grow. Our explorers must be given every chance to succeed in their search for new gas reserves. Beyond that, we must also ensure that the right companies are getting access to South Australia's highly prospective spaces.

Members interjecting:

The SPEAKER: Order! The minister has the call.

The Hon. A. KOUTSANTONIS: Not spelt that way, no. To this end, last week I released new competitive tender areas for gas exploration. The designation will further boost the focus on creating an environment where available areas arise regularly reducing the occurrence of large areas of land banking by having a strictly enforceable work program of exploration to execute within a set time frame.

Declaring these areas ensures applications for exploration licences in these highly competitive spaces can only be made in response to an invitation to tender. Companies seeking new acreage in these new competitive tender areas will need to show their bona fides—their financial and technical capability to undertake good practice five-year work programs before acreage is awarded.

The Arrowie, Arckaringa and Polda basins are now designated competitive tender areas. These basins were selected not only because they are highly prospective but also in response to a 10-fold increase in applications for petroleum, geothermal and gas exploration licences this year.

In 2022, we received 52 applications for gas exploration compared with an average of three or four under the previous government. What has changed? A government that does not ban exploration of oil and gas. We are seeing industry ramp up its interests in exploring for natural resources in South Australia, and it is clear to us that we need to ensure that the appropriate regulations are in place to give serious companies every chance to succeed, that is, no sovereign risk, no politics playing with gas exploration.

These designations will achieve this by improving competition and reducing land banking, which will free up prospective areas regularly, encourage exploration to bolster our local gas supply and stop the politicisation of exploration of oil and gas, as was done under the previous government, which quite frankly put a brake on our economy.