CRITICAL ISSUES IN DRILLING & COMPLETIONS
Amid regulatory headwinds,
Australia seeks policy stability,
growth for gas and LNG markets
Industry must continue to position itself as a key
player in energy transition, but needs broader
support to attract the necessary investment
Samantha McCulloch, Chief Executive,
Australian Energy Producers
BY STEPHEN WHITFIELD, SENIOR EDITOR
What was the motivation behind your
recent name change from APPEA to
Australian Energy Producers?
We were the Australian Petroleum
Production and Exploration Association
for more than 60 years, so it was a name
that held us in good stead for decades. But
when we looked at the role of our indus-
try today and the role of the industry in
our future, it’s actually broader. Of course,
we’re exploring for and producing oil and
gas, but our industry is key to net-zero
technologies, and it’s key to the invest-
ment in and deployment of low-emission
fuels. We wanted a name that reflects that
broader role of the industry.
What do you see as some of the big-
gest challenges facing the industr y in
Australia? And what roles can organi-
zations like yours play in helping the
industry address those challenges?
It’s a challenging environment as we
transform our global energy systems to
net zero. Australian Energy Producers has
committed to net zero, and we see tremen-
dous opportunities, particularly with the
role of natural gas in that transformation,
in terms of partnering with renewables to
provide power to Australian homes and
businesses. Gas will also play an important role
in supporting manufacturing and new
industrial opportunities. In Australia, we
talk about critical minerals manufacturing
opportunities, and gas can be a key partner
in that.
Even in a net-zero pathway, we still
need oil and gas, so communicating that
understanding and translating that into
policy settings and support is critical. In
Australia, it’s been a very challenging and
dynamic policy environment for the past
12 months. We’ve had a range of interven-
tions and policy reforms that have added
to the cost and complexity of the operating
environment and the investment envi-
ronment for the industry. That’s had an
impact in terms of our reputation.
We’ve had some of our key international
investors and customers raising concerns
publicly about whether Australia is still a
reliable supplier of energy. That’s some-
thing that we, as an industry, are very
concerned about.
For example, we have seen court deci-
sions overturning approvals for projects
that had been approved by the nation-
al regulator. We need new regulations
to ensure meaningful consultation with
Traditional Owners – Aboriginal and
Torres Strait Islander people – as well as
certainty for business.
We need to ensure we have stability in
policy setting and a policy environment
that attracts new investment and enables
us to continue to be a reliable, secure sup-
plier of energy to the region. That’s really
central to the work that we’re doing.
What do you say to those investors
who might be a little skeptical of Aus-
tralia’s energy position?
This all has been the result of months
of policy interventions and change, and it
has been concerning to the industry and
the broader international investment com-
munity. There are challenges in Australia’s
operating environment, but we think we’ll
see greater stability going forward. As
an industry, we’re calling on the gov-
ernment for policies that will encourage
new domestic supply to ensure our energy
security. We have abundant gas resources,
but we are in a situation where energy
authorities and the energy analysts are
forecasting supply shortfalls.
Also, we play such an important role
in terms of regional energy security. Our
LNG exports underpin many of our stra-
tegic relationships in the region and sup-
port decarbonization efforts. We want to
ensure that we’re able to service the grow-
ing demand for LNG and gas in our region.
Can you provide some examples of
regulatory changes that have had this
negative effect on operating costs in
the region? What kind of impact have
they had, exactly?
In our East Coast market – the largest
market in Australia in terms of popula-
tion density – price caps were introduced
on the wholesale gas market toward the
end of 2022 without industry consulta-
tion. That created a lot of uncertainty,
and it took quite a few months for us to
just work through the details of how this
was going to work in practice. It’s meant
that projects have not been able to move
forward. Investments that were aiming to
supply gas to the domestic market have
not been able to progress. Some gas supply
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