Zoe Yujnovich’s APPEA 2019 annual conference speech
May 29, 2019
I would like to begin by acknowledging the traditional custodians of the land on which we meet – the Jagera and Turrbul People – and pay my respects to their elders both past, present and future.
In fact, this week is a very special week, as Dr Lynham and Shannon Ruska mentioned, being National Reconciliation Week. The week is themed Grounded in Truth, Walk Together with Courage.
At the heart of this is the relationship between the broader Australian community and Aboriginal and Torres Strait Islander peoples.
Given the close relationship between the resources industry and Indigenous groups and communities, I urge you all to get involved in the events being run this week to learn more.
Our nation’s past is reflected in the present and will continue to play out in the future unless we heal historical wounds, let’s all take a leadership role in achieving reconciliation in Australia.
And now to our other distinguished guests:
- The Honourable Dr Anthony Lynham, the Queensland Minister for Natural Resources, Mines and Energy,
- The Honourable Mark McGowan, Premier of Western Australia
- The Honourable Paul Kirby, the NT Minister for Primary Industry and Resources,
- The Honourable Martin Ferguson, the former Federal Minister for Resources and Energy,
- Ladies and gentlemen,
Today we gather with the federal election rapidly disappearing in the rear-view mirror.
For some, the campaigning is over.
But for our industry…today…as APPEA Chairman I believe our campaigning has barely begun.
The time has indeed come to start Navigating the Future, the theme of this conference.
The Coalition Government has been returned to office with a mandate from the “quiet” Australians, as the Prime Minister describes them.
And, as the Prime Minister noted, people want to see the politicians simply get back to work.
Like the government, our industry is working for Australia’s long-term prosperity and how matters such as investment, employment, environment and wages impact society’s standard of living.
We understand the decisions governments face are not easy.
Whether it is grappling with carbon and climate politics (and just as an aside, I don’t expect that to recede as an issue despite the election result) – to equally contentious issues such as taxation, regulation, energy competition and export restrictions, development and conservation.
And like us, the government has many stakeholders to consider; multiple jurisdictions, opponents and constituents.
Now, in the wake of the election, when armchair experts on social media are hoarse from shouting, we have a clear opportunity to help drive real change.
What we can do now is assist this new Coalition Government overcome the tumult that has surrounded energy and resources policy in Australia for too long for the betterment of our customers, our investors and the nation.
But we can only do this…to be influential…to be persuasive…on the basis that we are trusted throughout the community, the business world and the political realm.
And trust is built from nor only what we do, but importantly how we do it and how we share the benefits of our work.
Our performance and our behaviours stem from the values that we hold dear.
We like to say it’s how we behave when we think no one is watching that defines us. Because as we know, everyone is always watching.
This is the case for ethics, this is the case for safety, this is the case for environment and this is the case for diversity and inclusion.
Operating safely and environmentally consciously is absolutely fundamental to society’s acceptance of what we do.
It is also fundamental to every single person who works in this industry, their families, our fence-line communities and beyond.
For the environment, our industry is best served when we are prepared to show our detractors that we can be the best land, marine and resource custodians, operating to the highest standards.
We should welcome the opportunity to be transparent and show how well we do operate. We must embrace scrutiny as a good thing.
Presently, using Queensland With diversity and inclusion, the industry must reflect the community we serve.
This is not only about gender issues – though more women in our industry would be a good thing.
But our industry must draw from a wider talent pool that more closely reflects the varied communities where we operate.
I’m pleased to see our industry has developed deep relationships with local and Indigenous communities: this helps our communities to value our presence and welcome our investment.
We do this through local procurement, Indigenous participation in skilled jobs and supporting farming communities with precious water produced from operations.
Not only are these things the right thing to do, but research has reminded us time and time again that acting ethically, whether it be safety, environment, diversity enhances our performance and reputation and creates a culture in our organisations that makes us more competitive and resilient.
Our issues are complex and challenging.
One of our greatest challenges comes not only in how we act today…but in acting today in a way that society will judge us in decades to come…in a way that we know our parents or kids would be proud of.
Ultimately, our long-term legitimacy, reputation and social licence to operate are at stake.
So as we turn our attention to advancing the cause of our industry, let’s remember to keep our values at the forefront of our mind all the time.
We can, however, be rightly proud of our record.
We operate to the best safety protocols in the world.
We can show how deeply committed we are to this nation.
We have collectively invested 350 billion dollars in Australia over the past decade, signalling not only the revival of the industry but a massive injection into Australia’s economic outlook and a huge vote of confidence.
We have created or supported more than 100-thousand direct and indirect jobs.
The Petroleum Resource Rent Tax we have paid as an industry over the past 15 years would pay for 6000 kilometres of roads, 1400 schools or building 35 hospitals.
We have also made good progress recently with governments.
The Northern Territory overturned its onshore gas ban and the Beetaloo project is moving ahead.
We saw a promising outcome from the Western Australian onshore gas inquiry.
The Queensland Government has released new acreage for gas exploration, as Dr Lynham just announced.
As APPEA, we’ve launched the Brighter program to highlight the industry’s contribution to contemporary lifestyles, small business and transitioning to a cleaner energy future.
You saw a small glimpse of this is Andrew’s opening video. Brighter is all about natural gas and how we use it every day.
The program exists to draw out and champion positive stories surrounding natural gas, from the best public BBQs and gas-powered ships, to the role industry plays in STEM education and supporting local communities.
APPEA members can help the program by attending Brighter events in the community, spreading the word online and through social media, and talking to your stakeholders about this.
The Brighter team is onsite outside the Great Hall and in the APPEA lounge for more information.
I am delighted that APPEA is championing such an essential, proactive initiative and I urge every APPEA member to support this national program.
Meanwhile, we have had strong engagement with all sides of politics through the recent election campaign, which helps us in future talks over public policy.
Now the window of opportunity has again opened.
And it is time to act.
I’m delighted that we have an energetic new association chief executive in Andrew McConville to spearhead the industry’s advocacy and help boost our public profile.
I look forward to working with Andrew and his APPEA team to develop the roadmap to help drive and deliver our vision and our collective, collaborative approach.
And there’s much work to be done.
There’s increasing pressure and higher expectations from society that business should play a role in helping address our contemporary global challenges.
So if we are to rise to this challenge, we must have well-reasoned positions – strongly principled but also politically pragmatic and socially attuned.
And in order for that to be possible, all of us must do a more thorough job of developing a united industry position before we go public. We need to have one vision and speak with one voice.
We talk about the need for collaboration but sometimes our stakeholders see our actions as acting independently.
If we want our politicians and the public to listen to us, we can’t be telling them different things.
So it is up to us, as members of APPEA, to use the association’s forums to review our public policies and develop our positions. This buy-in is critical for our future success – we all have a responsibility and an important role to play.
This is an invitation to all members to get involved: after all, the majority of people on the APPEA board represent medium-sized businesses.
Of course, we will not always agree on every issue, but collectively we all face similar challenges in the same jurisdictions.
And we must act now, as the world is moving forward rapidly and momentum is gathering in contested areas of debate, such as renewables and hydrocarbons.
Increasing swathes of southern Australia, onshore and offshore, are being locked up, preventing resource and energy development.
It should be unthinkable that a resource-rich country like Australia is prevented from looking after the energy needs of its own people and helping to lift the hundreds of millions of people around the world out of energy poverty.
We know the benefits that flow from this development: better jobs, upskilling and educational opportunities and stronger, more resilient, communities.
I like to ask: “What do blue skies in Beijing, education in Africa and batteries in Australia all have in common?”
The answer is that the world is now truly in the ‘Age of Gas’.
Our industry is helping the globe make the transition to lower greenhouse choices through natural gas.
Our gas is transforming the skies in Beijing through displacing coal as an energy source, reducing air particulates producing large health and environmental benefits.
Our gas is helping to bring education and healthcare services to more Africans as the country scales the energy prosperity curve, lifting more people out of poverty.
Our gas can complement renewable energy on an industrial scale alongside household batteries being built in the old Holden factory in Adelaide.
And we need to keep advocating for the role of gas and not become complacent about its critical role in supplying cleaner energy across the nation and to the world.
We can’t afford to rest.
Our opponents are well orchestrated, well-funded and well drilled on tactics aiming to destroy an industry that has been an overwhelming force for good.
We know we are operating in a responsible way for regional Australia: we just need to tell our story with more relevance and more vigour in the cities. It is here where we face the strongest ideological opposition.
Armed with megaphones and iPhones, an increasing number of professional activists and huge armies of ideologically driven volunteers are waging a virtual war with religious zealotry.
What the industry needs to avoid is being drawn into the trap of ‘either/or’ debates:
- domestic or export energy,
- hydrocarbons or renewables,
- solar or gas,
- battery or pumped hydro, or myriad other technologies.
These oppositional constructs are as deceptive as a sideshow hall of mirrors because they create face-offs between mutually beneficial technologies.
We must reframe the debate to explain that, for example, not only can natural gas and renewables coexist, but that they are perfect energy partners.
Of course, developing more energy and more diverse sources of energy supply will help, not hinder, affordability for our customers, both here and abroad.
And in this respect, APPEA, as your industry association, will lead the way.
The priorities for our industry involve three key policy settings.
- Firstly, climate change.
- We need a joined-up national energy policy that is consistent with our national climate change goals, helps to remove barriers to supply and reduces sovereign risk.
- We need to achieve this because poor or disjointed policy reduces investment attraction.
- Secondly, domestic gas supply
- The market needs more supply and more suppliers to address affordability.
- More transparency and competition in the market is vital for efficiency and public confidence.
- In practice, this means better access to resources and regulatory reform to lower exploration and production costs, and to enable efficient markets to operate and generate more competition.
- And thirdly, tax reform.
- APPEA will ensure its voice is heard in any variation to the Petroleum Resource Rent Tax, thin capitalisation treatment and wider tax reform to ensure Australia remains globally competitive.
The global capital market is highly competitive, and we are competing for investment into our industry.
If the business environment is not attractive this scarce capital can easily go elsewhere.
These settings have impact right around Australia. Let’s quickly tour Australia with some examples.
For starters, let’s talk about east coast gas.
Presently, using Queensland gas to supply southern markets does not deliver lower prices because of the additional, cost of transporting the gas over thousands of kilometres.
An alternative is to convince state governments to reverse onshore gas development bans.
Providing transparency on supply and pricing to the domestic market eases the pressure for government to intervene.
On the west coast, we need to ensure we cooperate to deliver maximum value to resource holders, our shareholders, the nation and our customers from our offshore backfill projects.
We also need practical responses and innovations to reduce carbon emissions, progressing technologies such as carbon capture and storage, like at Gorgon and when required, engaging in thoughtful conversations on carbon offsets and solutions.
To the south, we will be watching closely the New South Wales Government’s regulatory response to industrial customers over gas contracts.
Perhaps New South Wales will see the benefit of development of new local natural gas supplies?
Because of course, the cheapest gas is the gas that’s produced closest to the market where it’s consumed.
The solution is right there: the Narrabri gas project will offer local jobs, royalties, more secure supply and downward pressure on prices in NSW. It just needs the NSW government’s go-ahead.
Victoria has an ageing fleet of power generators. What would be the most effective solution? Lift the moratorium on conventional onshore gas in Victoria – this will improve energy security for manufacturing, reduce the cost of energy in the most populated parts of the country, support investment and drive job creation.
And we must emphasise that developing gas does not stifle the deployment of renewables like wind and solar. Gas facilitates investment in renewables because it is the best technology to provide sustained peaking power.
And this is a similar conversation that APPEA will continue to have with South Australia over stable power generation and the proposed offshore oil exploration in the Great Australian Bight.
We have our work cut out for us as the dust settles from the federal election.
But we do have a roadmap for success.
Our commitment to you is that APPEA will ramp up the dialogue with federal and state governments to ensure decision makers fully understand the benefits our industry brings.
We will tell our story with more impact to create more influence and we will work to build trust across the full spectrum of stakeholders.
There is a new sense of optimism and a reform agenda emerging.
The time is right.
A new political environment presents the best opportunity in a decade to deliver genuine policy reforms, including on energy and climate change.
So this conference – now it its 59th year featuring around 2000 delegates and more than 150 exhibitors – comes at a critical juncture in Australian and global energy debates.
Let’s Navigate the Future together, to increase energy security and make the least-cost transition to a cleaner energy mix.
I am determined our industry plants the seeds of positive public debate on energy and resource development through clear words, proactive engagement and good deeds into the future.