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How Australians are being dudded on our gas exports

Australia is exporting the majority of its gas without receiving a cent in royalties, representing $13 billion in lost revenue, according to a fresh report.

The Australia Institute’s Australia’s Great Gas Giveaway report found that six out of 10 export facilities for liquefied natural gas (LNG) do not pay royalties to either state or federal governments, resulting in 56 per cent of exported gas being “given away for free to the companies exporting it”.

Mark Ogge, principal adviser for the Australia Institute, said the government needs to introduce royalty taxes across all export facilities and launch an inquiry into the management of Australia’s gas resources.

“It is outrageous that the government wrote a 67-page future gas strategy and at no point considered how Australians could get a better return,” he said.

“It was a strategy about how we can benefit multinational gas companies rather than the Australian community.”

Gas industry

Australia exported 82 per cent of the gas it produced, or converted it into LNG for export, in the 2022 financial year.

The oil and gas industry is now paying the lowest amount of tax and fees per $100 in revenue in history.

Australia exports the vast majority of the gas it produces. Photo: AAP

Ogge accused the government over the past decades of having a cosy relationship with the gas industry.

“Australian ministers have gone straight from their jobs where they’re regulating and making the rules for the gas industry, into jobs with the gas industry,” he said.

“Politicians in Australia are too close to the gas industry. They seem to have lost sight of the fact that their job is to represent the interests of Australians.”

In the 2022 financial year, fossil fuel companies donated $2 million to the Labor, Liberal and Nationals.

Gas companies have also received millions from a secretive research and development fund, despite the scheme excluding fossil fuels.

According to Gas Energy Australia, the peak body for liquefied natural gas producers, the industry in Australia ‘supports’ over 250,000 full-time workers, but the total number of employed workers in the oil and gas industry was just over 17,000 in 2022.

A different model

Monique Ryan, independent MP for Kooyong, said Australia is allowing foreign oil and gas companies to sell off natural resources overseas for a massive profit and not pay tax.

“We could afford all the things that the younger generation should expect and which they deserve,” she said.

“We are asking the government to tax fossil fuels appropriately and get that money and use it for good.”

Senate crossbenchers previously banded together to pressure the Albanese government to force large gas companies to pay more tax.

Norway and Qatar are examples of countries with a high royalty fee on fossil fuel, according to the Australia Institute, but Australia chooses not to tax all of its natural gas exports.

Ogge said the country is being “price-gouged on our own resources”.

“If we applied a royalties tax to the rest of the gas exported, it would have raised $13 billion,” he said.

“A previous government decided it would remove royalties from oil and gas companies when it introduced the Petroleum Resource Rent Tax. This was a very bad idea.”

He said the gas industry also causes unpaid damages that should be addressed.

“The Australian public also pays for a lot of the rehabilitation. There’s tens of billions of dollars worth,” Ogge said.

“We know the gas companies aren’t going to cover that and the taxpayer is left on the hook.”

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