The first comprehensive analysis of the largest oil and gas investment boom on record reveals the industry’s $185 billion worth of new projects.
Commissioned by the Australian Petroleum Production & Exploration Association (APPEA) and produced by Deloitte Access Economics, the report – Advancing Australia: Harnessing our comparative energy advantage – analyses the economy-wide effect of the industry’s expansion and outlines the policy framework needed to secure long-term benefits for all Australians.
APPEA Chief Executive David Byers said: “More than half of the liquefied natural gas (LNG) projects now under construction globally are Australian and the economic consequences of this are overwhelmingly positive for Australia.
The oil and gas industry’s production profile directly and indirectly represents around 2.0 per cent of current GDP, with value added of about $28.3 billion in 2010-11 (based on total sales of $29.7 billion).
Over the period to 2025, the sector’s economic contribution to the national economy will be driven by the rapid growth in installed capacity and is projected to double to around $65 billion in 2020 and $60 billion in 2025.
In 2020, when production (on the basis of current and forthcoming capacity) and prices are expected to peak, the industry’s total economic contribution is projected to be around 3.5 per cent of the national economy.
To put this in perspective, the whole of the primary industry sector in Australia (agriculture, forestry, fishing and resources) accounts for 11.4 per cent Gross Value Added (GVA) to the Australian economy, meaning that in 2020 almost one-third of this GVA will come from oil and gas.
[Map courtesy: Deloitte Access Economics report: Advancing Australia: Harnessing our comparative energy advantage. ]