Latest news with #PetroleumResourceRentTax
ABC News
2 days ago
- Business
- ABC News
Reworked Petroleum Resource and Rent Tax raising $4 billion less than first thought
The tax on oil and gas profits is expected to raise $4 billion less than the government forecasted when it first announced a rework of the tax in 2023. Last year Treasurer Jim Chalmers amended the Petroleum Resource Rent Tax, which applies to offshore petroleum projects including the recently-extended North West Shelf, in a measure the government said would raise an additional $2.4 billion over the four years from the 2023 financial year. Mr Chalmers said the changes would mean "offshore LNG industry pays more tax, sooner". In that year's budget the forecast was that $10.8 billion would be raised over those four years — but the federal budget handed down just days before the election was called reveals the government now expects to raise just $6.3 billion over that same period. It is also now forecasted to raise less each year than what was expected before the government's plans to rework the PRRT. The government's amendments to the PRRT came after a Morrison-era review of the tax found it needed to be updated, in part because it was designed for oil but liquid-natural gas now dominates. Mr Chalmers has previously said from the PRRT's inception in the 1980s to 2024, not a cent of Petroleum Resource Rent Tax had been paid on LNG facilities. That is because under the PRRT, tax only becomes payable once projects become cash flow positive, meaning all expenditure has been deducted, and LNG facilities have a large number of up-front costs. But Independent Senator David Pocock said the government had picked the weakest option put forward by Treasury, and now that appeared to be failing to deliver. "This is an absolute rort," Senator Pocock said. "In the last parliament Labor looked at PRRT, they had a range of options and they went with the very weakest one, and got that through with the Greens. "We are now getting less for our gas and still not a single cent of PRRT from offshore LNG, we are the second biggest exporter in the world, it is a total scam on Australians. "We're paying international prices for our own gas, and I think one of the shifts in this last election was finally the Coalition came out and said, 'Well actually we don't have a gas shortage, we have a gas export problem,' these companies have been taking the piss." Senator Pocock said the PRRT must be revisited. The federal government is deepening its investment in gas, having recently approved the extension of the North West Shelf by 40 years to 2070. A further decision whether to approve Woodside's proposal to open up the Browse gas field, which could produce an additional 11.4 million tonnes each year largely for export, also sits under assessment. The amount raised from the PRRT fluctuates with oil prices, and revenue raised in previous years has closely followed price fluctuations. The high water mark for tax paid through the PRRT was just under $2 billion in 2021-22, which the Australian Tax Office said reflected increased profitability due to higher oil prices cause by Russia's invasion of Ukraine in that year. But despite the government expecting to raise significantly more than that in the years since, it has not done so and is no longer projecting it will do so. Mr Chalmers did not respond to a request for comment, but in recent days has pointed to the PRRT reforms as one achievement of the last term. Independent MP Zali Steggall said the government has the opportunity to be more ambitious. "I don't accept that that was difficult reform to achieve, it was a long overdue loophole that needed to be closed for the sector," Ms Steggall said. "It was a bare minimum of what needed to be achieved. "I think the treasurer had a lot of lobbying from the fossil fuel and gas sector in particular." Ms Steggall said Treasury put forward as one option that at least 20 per cent of LNG revenue remain eligible for PRRT, about double the amount the government ultimately adopted. She said looking at that would be a good starting point for revisiting the PRRT. "At a time of record profits, I think that would be a much more equitable outcome for the Australian people," Ms Steggall said. "You can't on one hand talk about budget repair and needing to increase revenue but only target individual endeavour ... all tax has to be on the table."
The Advertiser
29-05-2025
- Business
- The Advertiser
Govt and industry say we need more gas supply. That's nonsense
The first act of a re-elected Albanese government has been to betray future generations. Before the final votes are counted, before ministers have even had time to get their feet under their desks, the government has approved one of the biggest fossil fuel projects in our history: the North West Shelf Extension. The North West Shelf isn't just another gas project. It's the expansion of a decades-old gas hub off the Pilbara coast in WA, near one of the world's oldest cultural sites, Murujuga. It threatens endangered marine life at Scott Reef. It will pump 4.4 billion tonnes of greenhouse gas emissions into the atmosphere - ten times Australia's annual domestic emissions. And nearly all of the gas will be shipped overseas. All this, approved under broken environmental laws a government-appointed review found unfit for purpose back in 2020. Laws Labor promised to fix but hasn't yet, after the PM intervened to stop an agreement that was reached with the Greens and crossbench late last year. Right now, communities on the mid north coast of NSW are assessing the damage from yet another flood - the second in four years that authorities are calling a once-in-500-year event. The climate crisis is not theoretical. It's here, it's now, and it's devastating our communities. This project is the textbook example of everything wrong with Australia's gas policy. Its approval comes off the back of a dangerous myth that more gas means cheaper prices for Australians. Over the past decade, east coast gas production has doubled. Prices have tripled. Domestic demand is falling, yet households and manufacturers are paying through the nose because more than three quarters of our gas is exported or used in export processing. Earlier this week households were told to brace for power bill hikes of up to 10 per cent - the cost of gas, coupled with ageing coal major factors as to why. Our approach is in stark contrast to other resource-rich nations. Norway, also a substantial gas exporter, now has a sovereign wealth fund worth $2.8 trillion. Meanwhile, we have nearly $1 trillion of debt. The government's spin about needing to support the energy security of our partners has also been shot down with reports showing Japan made over $1 billion last year by re-exporting our gas. The government and the gas industry say we need more supply. That's nonsense. What we need is a government willing to prioritise domestic use and put a fair price on exports. That means fixing the Petroleum Resource Rent Tax, strengthening export controls, and legislating a duty of care to protect young Australians from climate harm. Last term, I introduced a bill to enshrine that duty of care in law. It had support from across the political spectrum and 402 of 403 public submissions. But Labor and the Coalition blocked it. Because deep down, they knew it would stop projects like this one. The Albanese government has taken some steps in the right direction. It legislated emissions targets, invested in renewables, and began backing household electrification. But it also rebranded Scott Morrison's "gas-led recovery" as the "Future Gas Strategy", a document that flies in the face of advice from the IPCC, the IEA, and our own Office of National Intelligence. While I appreciate the confidential briefing the government gave to community-backed independents on this report, I will continue to push for its public release. Australians deserve to know its contents, especially in the context of their government continuing to approve projects like this one. Australians didn't vote for more gas exports. They voted for climate action, cost-of-living relief, and a future our kids can look forward to. Approving the North West Shelf Extension would deliver the opposite. MORE OPINION: It locks in decades of climate damage, deepens our energy crisis, and pours fuel on the fires of inequality. All so multinational gas giants can make a buck. That's not a strategy, it's a sell-out. It doesn't have to be this way. With its new mandate, the government had a once-in-a-generation opportunity to get this right. To reject this project. To fix our tax and environmental laws. To prioritise Australian families and businesses over fossil fuel profits. And to show the leadership this moment demands. Next week, the Cabinet is sitting in Perth. Maybe the PM would consider holding Cabinet in Taree instead so ministers can see first hand what happens to communities when projects like the North West Shelf Extension get approved. The first act of a re-elected Albanese government has been to betray future generations. Before the final votes are counted, before ministers have even had time to get their feet under their desks, the government has approved one of the biggest fossil fuel projects in our history: the North West Shelf Extension. The North West Shelf isn't just another gas project. It's the expansion of a decades-old gas hub off the Pilbara coast in WA, near one of the world's oldest cultural sites, Murujuga. It threatens endangered marine life at Scott Reef. It will pump 4.4 billion tonnes of greenhouse gas emissions into the atmosphere - ten times Australia's annual domestic emissions. And nearly all of the gas will be shipped overseas. All this, approved under broken environmental laws a government-appointed review found unfit for purpose back in 2020. Laws Labor promised to fix but hasn't yet, after the PM intervened to stop an agreement that was reached with the Greens and crossbench late last year. Right now, communities on the mid north coast of NSW are assessing the damage from yet another flood - the second in four years that authorities are calling a once-in-500-year event. The climate crisis is not theoretical. It's here, it's now, and it's devastating our communities. This project is the textbook example of everything wrong with Australia's gas policy. Its approval comes off the back of a dangerous myth that more gas means cheaper prices for Australians. Over the past decade, east coast gas production has doubled. Prices have tripled. Domestic demand is falling, yet households and manufacturers are paying through the nose because more than three quarters of our gas is exported or used in export processing. Earlier this week households were told to brace for power bill hikes of up to 10 per cent - the cost of gas, coupled with ageing coal major factors as to why. Our approach is in stark contrast to other resource-rich nations. Norway, also a substantial gas exporter, now has a sovereign wealth fund worth $2.8 trillion. Meanwhile, we have nearly $1 trillion of debt. The government's spin about needing to support the energy security of our partners has also been shot down with reports showing Japan made over $1 billion last year by re-exporting our gas. The government and the gas industry say we need more supply. That's nonsense. What we need is a government willing to prioritise domestic use and put a fair price on exports. That means fixing the Petroleum Resource Rent Tax, strengthening export controls, and legislating a duty of care to protect young Australians from climate harm. Last term, I introduced a bill to enshrine that duty of care in law. It had support from across the political spectrum and 402 of 403 public submissions. But Labor and the Coalition blocked it. Because deep down, they knew it would stop projects like this one. The Albanese government has taken some steps in the right direction. It legislated emissions targets, invested in renewables, and began backing household electrification. But it also rebranded Scott Morrison's "gas-led recovery" as the "Future Gas Strategy", a document that flies in the face of advice from the IPCC, the IEA, and our own Office of National Intelligence. While I appreciate the confidential briefing the government gave to community-backed independents on this report, I will continue to push for its public release. Australians deserve to know its contents, especially in the context of their government continuing to approve projects like this one. Australians didn't vote for more gas exports. They voted for climate action, cost-of-living relief, and a future our kids can look forward to. Approving the North West Shelf Extension would deliver the opposite. MORE OPINION: It locks in decades of climate damage, deepens our energy crisis, and pours fuel on the fires of inequality. All so multinational gas giants can make a buck. That's not a strategy, it's a sell-out. It doesn't have to be this way. With its new mandate, the government had a once-in-a-generation opportunity to get this right. To reject this project. To fix our tax and environmental laws. To prioritise Australian families and businesses over fossil fuel profits. And to show the leadership this moment demands. Next week, the Cabinet is sitting in Perth. Maybe the PM would consider holding Cabinet in Taree instead so ministers can see first hand what happens to communities when projects like the North West Shelf Extension get approved. The first act of a re-elected Albanese government has been to betray future generations. Before the final votes are counted, before ministers have even had time to get their feet under their desks, the government has approved one of the biggest fossil fuel projects in our history: the North West Shelf Extension. The North West Shelf isn't just another gas project. It's the expansion of a decades-old gas hub off the Pilbara coast in WA, near one of the world's oldest cultural sites, Murujuga. It threatens endangered marine life at Scott Reef. It will pump 4.4 billion tonnes of greenhouse gas emissions into the atmosphere - ten times Australia's annual domestic emissions. And nearly all of the gas will be shipped overseas. All this, approved under broken environmental laws a government-appointed review found unfit for purpose back in 2020. Laws Labor promised to fix but hasn't yet, after the PM intervened to stop an agreement that was reached with the Greens and crossbench late last year. Right now, communities on the mid north coast of NSW are assessing the damage from yet another flood - the second in four years that authorities are calling a once-in-500-year event. The climate crisis is not theoretical. It's here, it's now, and it's devastating our communities. This project is the textbook example of everything wrong with Australia's gas policy. Its approval comes off the back of a dangerous myth that more gas means cheaper prices for Australians. Over the past decade, east coast gas production has doubled. Prices have tripled. Domestic demand is falling, yet households and manufacturers are paying through the nose because more than three quarters of our gas is exported or used in export processing. Earlier this week households were told to brace for power bill hikes of up to 10 per cent - the cost of gas, coupled with ageing coal major factors as to why. Our approach is in stark contrast to other resource-rich nations. Norway, also a substantial gas exporter, now has a sovereign wealth fund worth $2.8 trillion. Meanwhile, we have nearly $1 trillion of debt. The government's spin about needing to support the energy security of our partners has also been shot down with reports showing Japan made over $1 billion last year by re-exporting our gas. The government and the gas industry say we need more supply. That's nonsense. What we need is a government willing to prioritise domestic use and put a fair price on exports. That means fixing the Petroleum Resource Rent Tax, strengthening export controls, and legislating a duty of care to protect young Australians from climate harm. Last term, I introduced a bill to enshrine that duty of care in law. It had support from across the political spectrum and 402 of 403 public submissions. But Labor and the Coalition blocked it. Because deep down, they knew it would stop projects like this one. The Albanese government has taken some steps in the right direction. It legislated emissions targets, invested in renewables, and began backing household electrification. But it also rebranded Scott Morrison's "gas-led recovery" as the "Future Gas Strategy", a document that flies in the face of advice from the IPCC, the IEA, and our own Office of National Intelligence. While I appreciate the confidential briefing the government gave to community-backed independents on this report, I will continue to push for its public release. Australians deserve to know its contents, especially in the context of their government continuing to approve projects like this one. Australians didn't vote for more gas exports. They voted for climate action, cost-of-living relief, and a future our kids can look forward to. Approving the North West Shelf Extension would deliver the opposite. MORE OPINION: It locks in decades of climate damage, deepens our energy crisis, and pours fuel on the fires of inequality. All so multinational gas giants can make a buck. That's not a strategy, it's a sell-out. It doesn't have to be this way. With its new mandate, the government had a once-in-a-generation opportunity to get this right. To reject this project. To fix our tax and environmental laws. To prioritise Australian families and businesses over fossil fuel profits. And to show the leadership this moment demands. Next week, the Cabinet is sitting in Perth. Maybe the PM would consider holding Cabinet in Taree instead so ministers can see first hand what happens to communities when projects like the North West Shelf Extension get approved. The first act of a re-elected Albanese government has been to betray future generations. Before the final votes are counted, before ministers have even had time to get their feet under their desks, the government has approved one of the biggest fossil fuel projects in our history: the North West Shelf Extension. The North West Shelf isn't just another gas project. It's the expansion of a decades-old gas hub off the Pilbara coast in WA, near one of the world's oldest cultural sites, Murujuga. It threatens endangered marine life at Scott Reef. It will pump 4.4 billion tonnes of greenhouse gas emissions into the atmosphere - ten times Australia's annual domestic emissions. And nearly all of the gas will be shipped overseas. All this, approved under broken environmental laws a government-appointed review found unfit for purpose back in 2020. Laws Labor promised to fix but hasn't yet, after the PM intervened to stop an agreement that was reached with the Greens and crossbench late last year. Right now, communities on the mid north coast of NSW are assessing the damage from yet another flood - the second in four years that authorities are calling a once-in-500-year event. The climate crisis is not theoretical. It's here, it's now, and it's devastating our communities. This project is the textbook example of everything wrong with Australia's gas policy. Its approval comes off the back of a dangerous myth that more gas means cheaper prices for Australians. Over the past decade, east coast gas production has doubled. Prices have tripled. Domestic demand is falling, yet households and manufacturers are paying through the nose because more than three quarters of our gas is exported or used in export processing. Earlier this week households were told to brace for power bill hikes of up to 10 per cent - the cost of gas, coupled with ageing coal major factors as to why. Our approach is in stark contrast to other resource-rich nations. Norway, also a substantial gas exporter, now has a sovereign wealth fund worth $2.8 trillion. Meanwhile, we have nearly $1 trillion of debt. The government's spin about needing to support the energy security of our partners has also been shot down with reports showing Japan made over $1 billion last year by re-exporting our gas. The government and the gas industry say we need more supply. That's nonsense. What we need is a government willing to prioritise domestic use and put a fair price on exports. That means fixing the Petroleum Resource Rent Tax, strengthening export controls, and legislating a duty of care to protect young Australians from climate harm. Last term, I introduced a bill to enshrine that duty of care in law. It had support from across the political spectrum and 402 of 403 public submissions. But Labor and the Coalition blocked it. Because deep down, they knew it would stop projects like this one. The Albanese government has taken some steps in the right direction. It legislated emissions targets, invested in renewables, and began backing household electrification. But it also rebranded Scott Morrison's "gas-led recovery" as the "Future Gas Strategy", a document that flies in the face of advice from the IPCC, the IEA, and our own Office of National Intelligence. While I appreciate the confidential briefing the government gave to community-backed independents on this report, I will continue to push for its public release. Australians deserve to know its contents, especially in the context of their government continuing to approve projects like this one. Australians didn't vote for more gas exports. They voted for climate action, cost-of-living relief, and a future our kids can look forward to. Approving the North West Shelf Extension would deliver the opposite. MORE OPINION: It locks in decades of climate damage, deepens our energy crisis, and pours fuel on the fires of inequality. All so multinational gas giants can make a buck. That's not a strategy, it's a sell-out. It doesn't have to be this way. With its new mandate, the government had a once-in-a-generation opportunity to get this right. To reject this project. To fix our tax and environmental laws. To prioritise Australian families and businesses over fossil fuel profits. And to show the leadership this moment demands. Next week, the Cabinet is sitting in Perth. Maybe the PM would consider holding Cabinet in Taree instead so ministers can see first hand what happens to communities when projects like the North West Shelf Extension get approved.
