Interview with Kieran Gilbert – Sky News – Wednesday, 13 September 2017


SUBJECTS: Gas export trigger, energy policy crisis.

KIERAN GILBERT: Let’s go live to the Shadow Trade Minister Jason Clare, this morning. You are calling on the Government to pull a trigger on the gas domestic reservation. Can you explain exactly how that works?

JASON CLARE: This is something that Malcolm Turnbull can do today. You’ve got record energy prices. Remember the Libs promised they’d cut energy bills by $550. Now people are paying about a grand more. You’ve got businesses as well that are struggling with record prices. If he pulled the gas reservation trigger today it’d help to bring those prices down.

GILBERT: So how does that work, it means less exported gas, is that it?

CLARE: It means that the companies that are exporting gas would have to put more gas back into the domestic market. You’ve got businesses at the moment that are saying that they’re being offered contracts that are double the price of last year – $15, $16, $17, $18 a gigajoule. And you’ve got businesses – you’ve got the Ai Group saying that as these prices businesses are going to go offshore, shutdown, sack workers. The problem is Malcolm Turnbull has set up this trigger but he hasn’t pulled it. If he pulls it we’re going to have a big positive impact on electricity and energy prices.

GILBERT: But why hasn’t he pulled it then, in your view? Is it because then these companies that are scheduled to export this gas are then left with – well how do they supply their markets in Asia and elsewhere?

CLARE: Well who knows why he’s delaying. I’m saying pull your finger out and pull the trigger. I really worry that there’s a delay here because he’s worried that Barnaby Joyce has to pull the trigger as the Resources Minister, and he’s waiting until the High Court decision to see whether he’s legally able to pull the trigger. So we have to wait until late October for this to happen.

GILBERT: Does it have to be the Minister – the Deputy Prime Minister to do it? It can’t be the Prime Minister?

CLARE: The way the law has been set up is the Resources Minister needs to determine there’s a gap in the market, they’ve got the AEMO report that will tell them that. Then he’s got to consult with the Prime Minister and a couple of other Ministers, and they can pull the trigger. They can do it today. The way the law works is from the 1st of September they can pull the trigger. It’s the 13th of September now and you’ve got people out there struggling with high energy bills. Businesses – Bluescope is a good example of this – that are being offered $15 a gigajoule, saying this is unaffordable. The Prime Minister said this policy is designed to bring those prices down. For all of the rhetoric in the Parliament about spot prices, it’s not affecting the contracts that companies are being offered. Pull the trigger. Pull the trigger and you can make a very positive impact right now on this energy crisis.

GILBERT: Are companies being offered contracts which are still above what you could buy in, say one of our trading partners like Japan?

CLARE: Way above international prices. So in some cases you can buy our gas cheaper in Japan then you can back here in Australia.

GILBERT: Can you explain why that’s the case?

CLARE: Partly it’s because there’s not enough gas being made available to the Australian market. You’ve got some domestic gas which is being sold back to these LNG operations on Curtis Island, liquefaction happening and sent off overseas. So the policy the government has put in place, we support, which is put more gas back into the domestic market. If you’ve got more supply, you’ll reduce the price. The problem is the policy is there, but the government hasn’t implemented it yet. That’s why I’m saying, you’ve got the trigger, pull it and you can reduce prices.

GILBERT: Under the former Labor government a lot of these deals were done then, the facilities at Gladstone Port and so on expanded for this very purpose, under Labor.

CLARE: Absolutely, and we should support exports. It grows the economy, creates new businesses, creates more jobs. It’s a rubbish argument to say that the Liberal Party wouldn’t have supported expanding exports. When we said before the last election that we need a reservation policy to make sure you’ve got enough gas for the domestic market, you had the Liberal Party coming out and slamming it, saying that it would stop the creation of new business and new jobs. Both parties, I think, are now agreeing that we need to make sure there is enough gas for the domestic market.

GILBERT: The problem is, Mr Turnbull has met with the Origin Chief, has met with the various energy chiefs, AGL Chief, over many months now and we saw them commit to pumping more gas into our domestic market. So you’re saying they’re not doing that, or they’re doing nothing?

CLARE: There is some of that. But if you’ve still got companies being offered prices that are double what they paid last year, it tells you that you’ve still got a problem. What this trigger does is force even more gas back into the domestic market.

GILBERT: Aren’t you worried about the implications of distorting the export trade then?

CLARE: There will still be a lot of gas exported. Of that be in no doubt.  And companies are making changes to their export arrangements, but our first priority has got to be to Australian companies. If they don’t have gas at affordable prices, there’s a risk that they’ll shut down.

GILBERT: Do they lose credibility as exporters though, if they’re not able to meet the contracts as signed?

CLARE: They’ve got the flexibility to make arrangements that may involve swapping gas in or out. Companies are doing that now. Some are putting gas back into the market, but Kieran, if we’ve got companies being offered contracts that are double what they were last year, we’ve got a problem. My concern is you’ve got the Prime Minister manufacturing a fight with us on this, when he could be doing something as Prime Minister and pulling the trigger.

The reason he has got a fight with us, I think, is to try to camouflage the fight in the Liberal Party. They’re at war again on climate change policy. They were fighting about this in 2009. It lead to Malcolm Turnbull being knocked off as Prime Minister. It’s all happening again inside the Liberal Party.

GILBERT:  Mr Clare, I appreciate your time as always.