AUSTRALIA

Report backs Oz gas role

THE eleventh <i>Energy In Australia</i> report, prepared by Department of Industry, Innovation and Science chief economist Mark Cully, has reaffirmed the vital role of the energy industry as a major contributor to the Australian economy, contributing around $96.6 billion to industry gross value added &ndash; about 6% of the Australian total.

Report backs Oz gas role

The coal, oil and gas extraction industries are the largest sectors, contributing around $52.3 billion to industry gross value added in 2014-15, while the electricity supply industry contributed a further $26.4 billion to the economy.

Energy-related industries also contributed 1.3% to total Australian employment in 2014-15, employing around 155,000 people, as well as providing significant infrastructure investments.

The Australian Pipelines and Gas Association has welcomed the findings of the report, which shows that in 2013-14 825 petajoules of gas was consumed nationally, compared to 790PJ of electricity, in providing stationary energy.

That happened in an environment where energy use has actually fallen locally thanks to an improved focus on energy efficiency.

"Clearly, natural gas is a critical part of Australia's energy mix, particularly for industry both for power and for heating," gas cheerleader and APGA CEO Cheryl Cartwright said yesterday.

"In fact, natural gas supplies almost twice the energy that electricity supplies to the manufacturing sector - 400PJ compared to 225PJ.

"Gas is second only to oil in providing useable energy for the Australian economy. And it is the largest provider of stationary energy as oil is mainly used in transport."

Of course, gas, particularly in New South Wales and Victoria, is a political topic and Cartwright lamented that some state governments are delaying or blocking the development of gas reserves.

"Although the main focus on the value of Australia's gas has been on the tremendous opportunities for LNG exports, its critical role in providing energy to Australia's manufacturing, commercial and domestic users deserves more attention," she said.

"Gas will also be a major part of the economy in the transition to low-emission power generation as electricity generated by gas produces approximately half the emissions of coal-fired electricity generation.

"In 2013-14 gas-fired power generation provided 174PJ electricity. If this was added to the non-electricity generating use of gas, the total end-use energy consumption of gas in the Australian economy would be just on 1000PJ.

"Currently, natural gas provides 22% of the electricity that is generated for the Australian economy; renewable sources provide 15%.

"In the race to encourage renewables in the production of electricity, gas's role in broader energy consumption should not be ignored; it can't be easily replaced."

The government report found that over the 10 years to 2013-14 Australian primary production grew at an average rate of 1.1% per year.

Total primary energy production in Australia in 2013-14 was 18,715 petajoules, around three times larger than domestic consumption. Net exports accounted for 72% of production.

Much of that comes from LNG and coal exports.

Black and brown coal accounted for 66% of Australia's primary energy productions in 2013-14, followed by uranium (14%) and natural gas (13%).

Crude oil, condensate, and naturally occurring LPG accounted for another 5%.

Renewables, mostly bioenergy and hydro, contributed the remaining 2%.

In 2013-14 Australia's primary energy production decreased by 4%, underpinned by a fall in uranium oxide, crude oil and brown coal production.

Queensland and New South Wales are the largest energy producing states, with most of Australia's coal production.

Coal was the largest energy export earner, with a value of around $37.9 billion in 2014-15, followed by LNG at $16.9 billion and crude oil and other petroleum products at $11.5 billion.

Export earnings from energy commodities decreased by 6% in 2014-15, mainly as a result of a fall in coal prices.

Half Australia's oil products were imported.

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