Federal Investments Bring Certainty to Gas and Minerals: Australian Peak Body

Australian Prime Minister Scott Morrison tours Fortescue Metals Group's Christmas Creek mining operations with Fortescue Metals Group CEO Andrew Forrest in Karratha, Western Australia, on April 15, 2021. Justin Benson-Cooper/The West Australian - Pool/Getty Images

The Australian mining, oil, and gas industry has welcome newly announced federal subsidies for fossil fuel and mineral projects worth hundreds of million dollars in Western Australia (WA).

Australian Petroleum Production and Exploration Association Deputy Chief Executive Damian Dwyer said that the new investments reflected the federal government’s recognition of the significance of gas in decades to come.

“This greater certainty for the industry will be critical for Australia’s economic recovery and commitment to decarbonise as part of a cleaner energy future,” Dwyer said, in comments obtained by AAP.

Apart from opening new developments for fossil fuels, the support package will improve the supply of key minerals used in wind and solar components, pumped hydro widgets, electric vehicle batteries, and defence and communications technologies.

In particular, the federal government will invest $140 million (US$103 million) in two new hydrogen hubs in Pilbara and Kwinana in WA, while another $6 million will go toward two other early-stage hydrogen projects.

It is expected that the two new hydrogen hubs, one initiated by BP Australia and another by the WA government, will generate more than 3,600 jobs and attract over $410 million in investment from the private and public sectors.

A national strategy has projected that the production of hydrogen for export and domestic use could bring about over $50 billion in additional GDP for Australia by 2050.

Australian Prime Minister Scott Morrison drives a hydrogen-powered car around a Toyota test track in Melbourne, Australia, on Nov. 9, 2021. William West/AFP via Getty Images

Meanwhile, the government will set aside around $60 million to develop two carbon capture and storage hubs in Burrup and Mid West and $7 million to explore the potential for setting up a third site in the Carnarvon Basin.

Prime Minister Scott Morrison said that the Burrup and Mid West hubs would reduce greenhouse gas emissions by 7.4 million tonnes annually from 2028, attract more than $1 billion in investment, and generate over 2,000 jobs.

Another notable investment besides the $8 million spending on WA’s critical minerals sector is the $50 million program to establish a new business and research partnership that focuses on the critical mineral supply chain.

The project will see Curtin University collaborate with the University of Queensland, James Cook University, and 33 business representatives to develop new technology that will give Australia a competitive advantage in critical areas, including nickel, cobalt and lithium supply.

Given the subsidies announced by the federal government, the prime minister said Australia would witness a boost in employment and improvements in supply chain sectors.

“WA is a world leader in critical minerals, and these investments are just the beginning of our commitment to the sector,” he said.

“These investments will also turbocharge the development of Australia’s critical minerals and clean hydrogen industries, helping achieve the government’s vision to make Australia a global producer and exporter of clean hydrogen by 2030.”