Interview with Melissa Clarke, ABC Radio National

MELISSA CLARKE: Madeleine King is the Federal Resources Minister; she's in Karratha today with the Prime Minister and the West Australian Premier.

Minister, thanks for speaking to AM this morning.

MINISTER MADELEINE KING: Oh, it's a pleasure, thanks Mel.

MELISSA CLARKE: I just want to start with the current fuel prices we're seeing, because oil's been back over $100 US a barrel. This is going to flow through to petrol and diesel users. The tax discounts that are currently in place, they're due to wrap up at the start of August, which is really only a week away. Is the Government going to extend those tax cuts?

MINISTER MADELEINE KING: Well those future decisions will be made at the time, and I know that time is coming, you know, right at us, but as we all are aware, this conflict in the Middle East, and it appears to be sadly spreading, just continues to cause instability in that global energy market and those oil prices, and I think your package there before said how they'll continue to fluctuate.

But the Government is very much aware of the pressure the increase in fuel prices does put on Australian families and we have taken action in the past and will continue to monitor how these prices do affect people and seek to deliver that kind of relief as best we can.

MELISSA CLARKE:  So it's a possibility that they could be extended, it's just not a decision that's been made yet?

MINISTER MADELEINE KING: Yeah, we won't rule anything out, and we've done so much around fuel security to make sure there is fuel available for consumers with the fuel and fertiliser security facility, as well as developing the fuel security reserve as well.

But as to the excise, the Treasurer and the Prime Minister in the ACT will consider that over the course of the week.

MELISSA CLARKE:  We have seen diesel under particular pressure and those Ukrainian strikes on oil facilities in Russia is also having an impact on the global market for diesel in particular. If the Government makes moves on both the heavy vehicle user charge and fuel excise and what effects both petrol and diesel, do you want to keep moving them in tandem or is there a possibility that you could look at further concessions for diesel but not for petrol, for example?

MINISTER MADELEINE KING: Oh look, that really is a decision yet to be made, but I expect that they go hand in hand, just because of the complexity of how you manage an excise literally through the bowser. But as you know in Australia diesel is consumed mainly through the agricultural industry and the mining industry, so it is I agree somewhat different, but nonetheless you try and keep things as simple as you can excise just for the transactional cost of it.

MELISSA CLARKE:  Now the Government today is announcing this pre-feasibility study into the possibility of a new fuel refinery in Western Australian with chemical company Perdaman. What does this pre-feasibility study involve?

MINISTER MADELEINE KING: Well, it's really important the work being done by Perdaman. Perdaman is a great Western Australian company that is developing our largest urea fertiliser refinery, and that's what we're going to visit today where we're going also to talk about this feasibility study for a new large scale oil refinery in Western Australia.

So this is about fuel security for the whole nation, but of course WA's now left without any fuel refining capacity after the closure of BP in Kwinana in 2021. So that is a really important initiative that we will look at where this could go, can it happen, we are able to import crude oil. Crude oil can be stored for longer. But really importantly, the combination of that in fuel security as well as the security of fertiliser through the Perdaman urea project here in Karratha, which the Government has been behind from the very beginning, are two very important projects.

MELISSA CLARKE:  When it comes to having more fuel refining capacity in country in Australia, as we just heard from Alison Reeve, the energy expert, she's suggesting look, you might just be switching from needing to rely on imported refined fuel to relying on imported crude oil. Does it really make that much difference when we still need to import raw materials anyway?

MINISTER MADELEINE KING: Well, there is two reasons it makes a great difference. Firstly, it's literally sovereign capacity in knowing how to do it, being able to have a capacity on the West Coast to refine crude oil into this product. And I note there is some prospect of crude oil discoveries off the West Coast of Australia.

But it is correct, we would need to import crude oil as well and that's exactly what happened at the BP refinery. But the difference with crude oil, the unrefined product, is it is storable and storable for much, much longer, almost permanently, than refined petroleum. So you can bring it in and have it sit in a vessel for some amount of time before you need to refine it. And that's a critical difference in times of crisis.

MELISSA CLARKE:  And to make the economics of a new fuel refinery process viable does the Federal Government need to offer support beyond what's currently available to the existing refineries in Geelong and Brisbane? Is that a possibility that your Government's willing to entertain, or is this just a case of saying to Perdaman, "If you can build it, you would have the same support that the refineries in Geelong and Brisbane have"?

MINISTER MADELEINE KING: Yeah, well I think we need to take this one step at a time. But the thing about Perdaman is they have proven themselves to get things done, and that's what we're seeing today at the Perdaman Ceres urea project. It's taken Vikas Rambal, the chairman, a number of years to get this going but we're going to see today a national sovereign capacity in fertiliser. And so for a company like Perdaman to come to government and say, "We're going to look at this", this Government is happy to combine with the State Government to see if we can make it happen.

And that's why feasibility studies are important, because you don't want to be going into a wholly uneconomic, it's got to have some strength behind it and I believe it has.

MELISSA CLARKE:  When it comes to the expansion of fertiliser manufacturing, you're visiting today to have more urea made here in Australia, the prospect of more oil refining in Australia, these are industries that are significant greenhouse gas emitters. Is having more of this done in Australia going to make it harder to hit targets of reaching net zero emissions by 2050?

MINISTER MADELEINE KING: Look, there's no doubt in a perfect world where the transition, energy transition was able to be smoother and that there wasn't such conflict, we would have a different trajectory perhaps to net zero, and the important thing is we have legislated for this. This Government is absolutely committed to driving down emissions.

But we do need fuel and we do need our energy security. Whether that be    

MELISSA CLARKE:  So this will mean more emissions between now and 2050?

MINISTER MADELEINE KING: Well any facility, and that includes the urea facility as well as any oil refinery, as in any gas project as well, if they go over the threshold they will be subject to the safeguards mechanism. No one is exempt from that and that is the Government's method of making sure we do drive down industrial emissions.

MELISSA CLARKE:  Federal Resources Minister Madeleine King, thanks very much for joining AM this morning.

MINISTER MADELEINE KING: Thanks Mel, it's a pleasure to be in Karratha.