Oil and gas to lead next WA boom
An oil and gas boom is tipped to replace the minerals boom and deliver hundreds of billions of dollars to the economy but add further strain to struggling parts of the nation.
As the Minerals Council of Australia cast doubt on revenue from the mining tax, the oil and gas sector said WA would be the biggest winner from increasing demand in China and other parts of north Asia.
An industry-commissioned report says oil and gas would add about $260 billion to national economy output over 13 years, with about $135 billion of it from WA.
But to make room for such big growth, other areas would shrink, with the report predicting NSW to give up almost $7 billion to other parts of the country.
Oil and gas, particularly the coal seam gas industry in Queensland, is under heavy criticism for its potential environmental impact.
But Australian Petroleum Production and Exploration Association chief executive David Byers said the report proved the importance of the sector and its continued expansion gave all Australians incredible opportunities.
The report estimated the industry would add at least $94 billion over the next 13 years to government coffers. But a Minerals Council report predicted the revenue from the minerals resource rent tax that begins next week to be highly variable.
BHP Billiton, Rio Tinto and Xstrata, the three companies that signed off on the tax structure, are key council members.
Study author Alex Robson, comparing the forecasts and outcomes from the petroleum resource rent tax, found huge differences between official Treasury forecasts and what the PRRT delivered.
Dr Robson said it was dangerous to expect consistent revenue from such a tax after the PRRT showed it was difficult to forecast.
A separate analysis by economists with UBS suggests the MRRT will collect $3.2 billion in its first two years rather than $6.5 billion because of falling iron ore prices and company valuations.
