Do-nothing Malcolm hits state gas brick wall

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The Do-nothing Turnbull government has clearly shifted from a policy of doing nothing to picking losers so that it can appear to be doing something while blaming others for it doing nothing. See housing affordability, the TPP, corporate tax cuts and, today, gas:

The split between the federal and Victorian coalitions over energy policy has dramatically widened, with Malcolm Turnbull blasting the state’s Labor government for “locking up” gas supplies on an ideological basis on the same day that his Victorian counterparts voted to support the policy.

The state Coalition will today reveal plans to wave through the Andrews government’s legislation to prevent all coal-seam gas exploration and mining as well as extending a moratorium on onshore conventional gas exploration and development until 2020. The Victorian conservatives’ opposition to gas, which began with a moratorium on coal-seam gas exploration in 2012, has outraged the energy sector, which has warned the state will soon pay a premium for imported gas.

The final stance emerged from a joint partyroom meeting yesterday, shortly before the Prime Minister launched a stinging attack on Labor’s energy policy in parliament. He singled out Victoria for “this ideological Left approach that the Labor Party adopts, sitting on all of this gas and they’re not prepared to touch it”.

“They have locked up all the gas,” he said. “The Victorian government will not even allow the exploration of onshore conventional gas in Victoria.

The state level gas battle is lost. It was never going to work to ease shortages anyway given any new gas will simply go offshore via Curtis Island anyway. Domestic reservation is the only option.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.