President Trump’s latest deregulation announcement in the US oil and gas industry could severely impact Australia’s $16.55 Billion Australian Liquified Natural Gas [LNG] exports. Western Australian companies are likely to be hit with the biggest financial losses.
The America First Energy Plan, released after Trump’s inauguration ceremony in January, outlines the infamous billionaire’s controversial strategy to deregulate the US energy sector to access up to $50 Trillion in untapped shale, oil and natural gas reserves.
Yet another one of Trump’s revolutionary measures to ‘make America great again’ the pro-fossil fuel plan will assist oil and gas companies in the domestic arena by encouraging businesses to use more local resources.
Better known for his orange complexion, total domination and unwavering stance in business on his TV Show The Celebrity Apprentice than his political experience, Trump’s controversial policies include banning immigrants—and more recently electronic devices on flights to the US—from ten Muslim countries.
The Trump Administration says the old regulations have been a major hindrance on the economy and the new plan will improve life for many.
“For too long, we’ve been held back by burdensome regulations on our energy industry. President Trump is committed to eliminating harmful and unnecessary policies such as the Climate Action Plan and the Waters of the U.S. rule. Lifting these restrictions will greatly help American workers, increasing wages by more than $30 billion over the next seven years.
Sound energy policy begins with the recognition that we have vast untapped domestic energy reserves right here in America. The Trump Administration will embrace the shale oil and gas revolution to bring jobs and prosperity to millions of Americans.”
LNG is a big deal to Australia. We are the third largest exporter in the Asia-Pacific and fourth largest in the world. More than 18.9 million tonnes were exported in 2011 alone. A value of approximately $11.1 billion.
The Australian mining industry constantly struggles with changing commodity prices. Industry experts say increasing gas production in the United States will put even more pressure on key Australian production companies.
Australia currently holds major contracts in the Asia-Pacific region including Japan, China, Taiwan and South Korea. Western Australia is one of Australia’s biggest LNG exporters with production plants based in the North West Shelf, Pluto and Gorgon. Queensland also has several major LNG production companies with operations at Gladstone and Curtis Island.
In a recent interview with the ABC, Chief Executive Officer of the Australian Petroleum Production Association, Malcolm Roberts, says the impact on Australian businesses could be considerable.
“If Australia ceases to be a competitive location they have plenty of competition elsewhere to invest. It’s going to mean in the medium term considerably more competition in what’s already an oversupplied global market for LNG. LNG demand is growing steadily but we are in a period of oversupply which is resulting in very low prices.”
The Australian Government Department of Industry, Innovation and Science were contacted but unavailable for comment.