Fuel move a step in the right direction but Aussie supplies a must
By Sourced Externally
June 17, 2020
AGRICULTURE sector leaders have praised the Federal Government for its push to shore up domestic fuel security but add that having adequate supplies within Australia should always be the goal.
The government this week announced it had opened a Request for Information (RFI) process to identify opportunities to increase Australia’s domestic fuel storage capacity.
This will see the government liaise with industry players on potential storage projects, which will allow the government to examine different volume, location and fuel storage specifications.
“We’ve been asking for the government to help shore up fuel security for some time and this is a step in the right direction, but the facts still are that if there is a disruption in fuel supply there is only three days’ supply for agriculture,” said Grain Producers Australia (GPA) chairman Andrew Weidemann.
“It’s a great step forward to look for more storage within Australia as recent initiatives to buy more oil as a strategic reserve were great but the facts are it is being stored in the US and would not be easily accessible if there were supply chain disruptions,” Mr Weidemann said.
National Farmers Federation (NFF) chief executive Tony Mahar backed Mr Weidemann’s sentiments.
“We welcomed the Australian Government’s recent purchase of $94 million worth of oil for a strategic reserve, however this oil is currently stored in the United States which is not helpful if supply chains are compromised,” Mr Mahar said.
“Should any sort of supply chain disruption occur, it is not certain that this oil would reach Australia quickly enough. It is crucial that the strategic reserve is stored in Australia.”
The government has also announced a review into the domestic fuel refining industry.
Mr Mahar said this was also important.
“An onshore strategic reserve will not achieve its purpose if the oil cannot also be refined onshore,” he said.
“Having to ship this oil to offshore refineries re-exposes the country to the risks which an onshore reserve is intended to avoid.”
Meanwhile, minister for energy and emissions reduction Angus Taylor said Australia currently had good fuel reserves, with petrol stocks at record highs.
Fuel consumption dropped to record lows during the early parts of the COVID-19 lockdown.
Australian Petroleum Statistics gathered at the end of April showed Australia held 30 days of petrol consumption cover, the highest level since electronic record keeping began in 1989.