Madigan gets backing on fuel security call

Engineers join senators in support of liquid fuel reserves inquiry

Madigan gets backing on fuel security call
Senator John Madigan with senator Nick Xenophon


Democratic Labour Party (DLP) senator for Victoria John Madigan has gained backing for his intervention on fuel security.

Outside Parliament, peak professional body Engineers Australia has supported Madigan’s call for a Parliamentary inquiry into liquid fuel reserves and, inside, other senators have spoken in his favour.

Madigan is calling for a national liquid fuel security plan and has moved a motion that the Senate "recognises that it is in Australia’s national interest to maintain liquid fuel refining capability".

He told the Senate that he had been "looking at the end-of-month stock holdings of various fuels as reported by the government.

"As of June this year we had 30 days’ worth of LPG in storage, 19 days of petrol, 17 days of aviation fuel and 12 days of diesel.

"This highlights two problems: the first is our dependence on imported fuel; and the second is our poor preparedness and capability to respond to any crisis."

He is concerned that there will be only four refineries in the country by 2016.

Inside Parliament, Madigan found Senate backing from the ALP, with senator Stephen Conroy backing the motion.

Independent senator Nick Xenophon spoke in favour, highlighting the vulnerability of supply lines from regional fuel hub Singapore.

"It has been long expected and the dynamics driving it are well understood," Xenophon says.

"Yet no Australian government has adequately assessed or planned for the obvious risks to our economy and society of a disruption to overseas fuel supplies."

Both Madigan and Xenophon referenced the NRMA’s report, Australia's liquid fuel security.

Engineers Australia public affairs executive general manager Dr Brent Jackson says Madigan is correct to point out the vulnerability that exists in domestic policy settings.

"As government reports and independent bodies like the NRMA have concluded, Australia is in breach of its 90-day liquid fuel stockholding obligations under International Energy Agency (IEA) agreements," Jackson adds.

Australia’s policy stance takes comfort in the notion that our IEA obligations would be met by simply recognising unrefined oil in tankers destined for Australia.

"This policy equivalent of ‘the cheque is in the mail’ is worrying. Liquid fuel in transit to Australia through some of the world’s geopolitical hotspots isn’t fuel security, it’s wishful thinking.

"The myth of an Australian strategic fuel reserve needs to be busted. With indicators pointing to an ever-reducing domestic refining capacity we need to shift our thinking to recognise that energy security doesn’t come from energy storage, but instead from energy flow.

"The uncertainty around our domestic fuel supply is one of the many reasons why Australia needs to ensure that resilience and security are core components of our national infrastructure strategy.

"This is a policy consideration that must involve coordination across sector, portfolio and jurisdictional lines."

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