Australian energy security collapses as Coalition goes AWOL

For years MB has warned about the decline in industrial capacity and the threat to strategic stability that that represents. In no sector has this been more clear than fuel refining capacity which has diminished from 10 refineries in the 1980s to four last year:

Since then, Kwinana has announced its intention to become a fuel import terminal only. And today:

ExxonMobil’s move to shut its Melbourne fuel refinery has sparked a warning about the impact on other major manufacturers who rely on its products.

…“The effect is a bit more significant than that. It is a key piece of Melbourne’s and Victoria’s and Australia’s advanced manufacturing structure,” Mr Kennedy said.

Mr Kennedy said major manufacturers such as Qenos relied on products from the Altona refinery and would now likely have to source that material from China, which was less reliable.

You don’t say.

What can I say? The transition to EV transport is lagging badly. Cheap gas is being ripped out of the ground and sold in Asia at half the price of here. The reliance on fuel imports is replete with geopolitical risk. Manufacturing is shocked again.

Meanwhile, the Morrison Government is pre-occupied with fighting conspiracy theorist troglodytes obsessed with symbolic politics around coal, while bedding down a gas export cartel that is ripping Australians off blind, as well as securing an emergency oil reserve domiciled on the other side of the planet, and doing nothing for fuel security beyond hosing hastily concucted subsidies that have now been summarily rejected.

Energy is the key input into our economy, technology, industry, living standards, social order, indeed civilisation and modernity, and the Morrison Government is AWOL, corrupt, or dragging the chain on every single facet of Australian security of supply.

Expect a new policy announcement and advertising campaign shortly for the launch of FuelKeeper which will source a magical new supply of petrol and jet fuel from the dark side of the moon.

David Llewellyn-Smith
Latest posts by David Llewellyn-Smith (see all)


  1. It’s all good – nothing to worry about – the Energy minister addressed this last year.
    Australia has a strategic oil and refining reserve – in Texas!

  2. > Energy is the key input into our economy, technology, industry, living standards, indeed civilisation, and the Morrison Government is AWOL, corrupt, or dragging the chain on every single facet of Australian security of supply.

    After Jim Molan was on Q&A in 2018 screaming (as much as any Liberal politician can) about our fuel insecurity I wrote to him asking that if we have a fuel security problem, not to mention the pesky peak oil problem why do the Liberals insist on entrenching car dependence though their idiotic support of mega toll road projects (this was at the time when the self annointed saviour of the East West Link – Michael “shady” Sukkar – was banging on about it) I also put the North East Link in this basket.

    I got no reply and when I called his office I was told that because I’m a pesky Mexican they weren’t going to write to me and instead forwarded my letter onto my local MP for an answer. Given my MP was #shadysukkar who hasn’t bothered to reply to any of my correspondence since I called out his BS over the East West Link in a public forum I’m still waiting for an answer.

    Time to head to the bike shop and stock up since we’re all going to be on the pushy soon.

    • Strange EconomicsMEMBER

      Assuming the energy security risk scenario is that submarines close the oil tanker import routes for 3 months till the US Navy arrives.
      time we moved quickly to electric cars quickly to mitigate this -. There is an endless reserve of coal under Sydney’s backyards (or solar) to keep them going.
      25% of oil goes to private car usage.
      Also saves 25 % on the massive expense of billions building the reserve.

  3. How about turning coal into diesel? It ticks all the boxes for the Coalition politically, and the technology was available since last century (Germany used it during WW2).

    • Strange EconomicsMEMBER

      Good idea, But massive energy loss (and greenhouse gases) in conversion.
      Currently we turn coal into EV fuel (though pretending it comes from solar).That is if the government would actually encourage EVs – it could use repurpose some of the subsidies for mining (like the diesel fuel rebate for mines).

        • Strange economicsMEMBER

          Actually should just build a modern biomass powered steam train and use a horse for local transport. Thats actually the highest efficiency conversion of power with least greenhouse gases, if you don’t use solar.

          But Check out the literature –
          using coal to oil sounds great, except for the greenhouse gases….

          e.g google to :
          The Coal To Liquids Imperative For Australian Fuel › DocumentStore
          Yes, the solution is to use coal-to-liquids (CTL) technology to convert the low-grade
          It sounds wonderful till they get to the part that it produces masses of Co2.

          However then half the paper explains that C02 global warming is a myth and the world actually needs more C02. (which is a minority viewpoint these days)
          Certainly will get the coal lobby excited.

    • Arthur Schopenhauer

      What exactly does “economically viable” mean? It cannot deliver the profits the owners demand or does it make a loss?

      • Probably has upcoming maintenance/refurb costs that are unlikely to be recovered from future operations, or see the future as too unstable to invest the required capital.

        • Arthur Schopenhauer

          Yep, that is the case and has been for 20 years.

          It really should not have been allowed to happen, and both side of politics have had 20 years to increase capacity in Geelong and provide incentive to relocate the associated chemical industries there. FFS Gillard was the member for Altona.

          Edit: The site is very polluted. Expect the state government to have pick up the tab for the clean up.

          • darklydrawlMEMBER

            “that is the case and has been for 20 years.” <– That is 100% accurate. They were going to shut it down back in the early 2000's until the Government did a deal with Exxon and kept the place running. The whole plant needs to be expanded and modernised but ExxonMobil didn't want to pay for it as they could ship in the refined product cheaper from Singapore. The Altona site has been on thin ice for decades.

  4. What should be astounding but isn’t because LNP is this Monty Pythonesque business of having strategic fuel reserves in America. I don’t think there’s a single person in the country who thinks this is a good idea for a host of reasons such as tankers being sunk while attempting to deliver it, or Americans deciding to snaffle it if they decide their need is greater than ours.

    Can you see an American politician saying “My fellow Americans who are short of fuel, we are shipping all this fuel to Australia because they need it more than you do right now so you’re just going to have to suffer for the benefit of our allies”? Can you see a Chinese submarine driver saying (in Mandarin) “All Hands stand down from action stations…we’re not going to sink that tanker because it’s carrying Australian strategic fuel reserves to them in their hour of need”.

    Our politicians really do think we’re chumps and treat us as such, and we have to suck it up because we have no system that allows citizens to exercise control over our politicians except for the regular farce of our elections.

    • And at the same time some states are proprosing a tax on EV usage!!! We should be moving as much of our passenger vehicles as possible over to evs right now. The people who are getting home battery subsidies in Vic (and hopefully other states) can then go out and buy a fancy EV and an increase in sales might encourage the ev manufacturers to actually make their models available here and just please can we get some of our passenger vehicles onto EV so we reduce some of our reliance and start building a little bit of resilience into the system…. please, pretty please? I mean we don’t even have to subsidise the evs just not put hurdles in the way of them, there are plenty of people who would buy a new ev if they actually had some choice

      • We should be focusing on EV (or hydrogen) buses, and improving our overall PT network. Focusing on private EVs still leaves us with a lot of problems that our cities currently face.

        • Or you could do both along with tax levers along with investment in bike networks.

          You won’t shift private car occupants onto PT en masse here, won’t happen (without massive congestion tax I spose)

          Also regionals, where PT is entirely impractical – EVs there would be great

          NSW needs to pull its finger out and scale up Empowering Homes across NSW ASAP. Ready to add to our 3kW system with 6 more plus battery which leads to a easier sell to upgrade 1 car to EV

          • Not to mention that in a Covid age no one really wants to use PT anymore if they can absolutely avoid it

          • Mark HeydonMEMBER

            Long time transport cyclist so I completely agree with investment in bike networks.
            I would go further and suggest government subsidy for e-bikes. For any trip under about 8km in city traffic an e-bike is quicker than a car, and except in extreme weather, just as comfortable. It also uses a fraction of the energy since there isn’t a tonne and a half of metal also being propelled.

      • darklydrawlMEMBER

        Whilst I completely support your ‘transition to EV’s’ comment, having local refining capacity is not about domestic transport, it is about defense. No good having a pricey fleet band new F35A’s if you cannot refuel them. None of our Naval fleet is nuclear powered (100% diesel). Given most of our refined product to power our defense forces comes out of Singapore, a hostile nation with a half decent navy could cripple Australia fairly quickly without losing much gold or blood in the process.

        • Very fair point, I hadn’t thought that far ahead in my thought processes. Urgh we’re such a nation of short-sighted lazy dumb @rses!

          • We’re an island nation that doesn’t make much stuff and imports most of what we want/need. Any hostile country with a few submarines could plant sea mines at the entrance to every major port, sink a few ships and we’d be back in the stone age very quickly. Think about no seaborne imports and no export of coal/IO/gas for a year. We’d all be sitting under trees banging rocks together in pretty short order.

            On the other hand, China are largely in the same boat. They are utterly dependent on imports, and our submarines could do exactly the same thing to them with their dependence on imports like coal for their power stations.

    • Angus Taylor knows exactly what chumps the Australian voting public are. He’s tested this and can declare it to be fact. He achieved this certainty of knowledge through getting re-elected and not being held to account at all after siphoning $ millions off into the Caymans Islands from a dodgey overland water rights sale.

      • I met him once, and he’s as slimy and smug and self satisfied in person as he appears in the media. Truly a vile creature who brings nothing but shame and disgrace to our public life.

          • I thought I was being subtle there. 🙂

            The thing that really struck me about him was his weak floppy handshake. I think it said a lot about him, none of it good.

      • Of course it is. Why we don’t have nuclear subs is beyond me. Just sink a few tankers and the refineries and Australia stops. The food doesn’t get from the country to the city. Too easy.

        • It is about defence.
          The sooner the civilian transport and energy are 100% renewable the more of our dwindling Bass strait FF reserve will be available for the military.

      • This Australian start up claims to be working on hydrogen farm and industrial vehicles
        They also seem to have signed a contract to develop a hydrogen facility in Bundaberg.
        My one evening of websearching them leaves me umming and ahhing about them.
        Hopefully they aren’t just a group set up to ride the wave of hope and extract grants from the gov.

        • Hydrogen tech isn’t new, it was all the rage in the 90’s for cars. Then reality intervened.
          Unless they have a previously unknown method of storage/transportation I’d be betting they are grant farming.

  5. Who needs to refine crude oil when the leader of the opposition is ‘pledging’ to be net zero carbon by Friday next week?

    • Arthur Schopenhauer

      We need 2 giga-scale battery factories, and they need a lot of petro-chemical products. But what have we got, nothing but a fkwit marketing man.

  6. It will take a legitimate crisis to wake up Dumbstralia. The most fragile rich economy on earth. Its obvious our leaders are deer in the headlights right now. They want the crisis to happen so they can blame it, instead of taking the necessary actions preemptively and having the crash pinned on them. Just keep an eye on events and be ready to act fast to protect yourself.

    Like when the pandemic was kicking off. I can remember stockpiling at least two weeks before everyone else started. At least. I had 30 odd cans of tomato’s among some other big buys and my regular shop. “Heh, theyre on special” I said to the checkout lady to avoid having to admit that I was actually stockpiling food for what was shaping up as a decade defining crisis. The govt wasn’t doing anything back then. I cant remember if this was before or after the notion of “fever clinics”. Wow, that sounds fantastic. I fully expected everyone to catch covid, including me, in the near future resulting in many, many deaths and a damaged society. I looked around, everyone was still acting normally. Except one other person who was also obviously stockpiling. They looked as nervous as I felt. We exchanged a glance at each others prep and I thought to myself, “here we go”.

    Fortunately not long after the Premier told everyone else in the country and world to go f themselves and everything turned out fine.

    • > It will take a legitimate crisis to wake up Dumbstralia.

      I thought COVID was going to be that crises. If you don’t understand how fragile our JIT supply chains are, then you’re not paying attention. The consequence of “efficiency” is no fat/slack in the system to cope with the unexpected. That’s why I keep telling my family to always buy a spare of everything at the supermarket and keep track of critical items. But who cares because we have an economy not a society amirite!

      I think there are some segments of the community who knows what’s going on. When COVID hit all the nursery’s in my area had to ration seedlings and even though we were going into the “winter market” (lower volume) the seedling growers were tripling production to cope with demand. A few Victory Gardens perhaps. Come spring they were still limiting the number of certain seedlings you could purchase.

      Even though it’s been such a bad season for tomatoes this summer, the zucchinis did really well.

      • “If you don’t understand how fragile our JIT supply chains are, then you’re not paying attention. ”
        This times many.
        It took less than a week from the PM saying everyone should have 2 weeks supply stored at home to telling people to stop hoarding as the Just-in-time supermarket system collapsed under slightly increased demand.

      • I can tell you that down the surf coast it has been a disastrous year for tomatoes……completely crapola crop, our zucchinis were nothing to write home about either

  7. Or we could do this

    Setting out to rebut defeatist and cynical claims that transitioning the entire global energy system to 100% renewables by 2035 is infeasible, a group of dozens of leading scientists from around the world unveiled a joint declaration Tuesday arguing that such a transformation of the fossil fuel-dependent status quo is not only necessary to avert climate disaster but eminently achievable.

    • Can’t help but notice a distinct lack of detail about how they think it is achievable.
      How much does lithium mining need to increase for this to happen, or copper, or aluminium, or rare earths? 2 fold? 4 fold? 10 fold? 100 fold? Is it even possible to extract these additional raw materials?

      • Or copper, cement, iron ore, nickel, chromium, aluminium, silver, etc etc. Then do it all again in 20 years.

        • What are we going todo when the last refinery closes in the near future?
          You obviously are a thinker , what are your prescriptions ?

          • If you truly believe it is feasible put your money where your mouth is.
            The great thing about renewables is they don’t require economies of scale like coal generation.
            Disconnect from the grid and go 100% renewable. Tell us how it works out and what the costs are like.
            Relying on a backup grid connection is cheating and reliant on fossil fuels though.

          • I think it requires investment in strategic industries of which this is one. It is time to stand up to the Harvard Business School burnt earthers and foreign mercantilists and protect those industries like everyone else on the planet does. Further it requires control of the private banks to ensure there is appropriate distribution of resources to projects other than housing. Investment should be channeled into industries that replace imports and win foreign exchange and those industries should be protected until there are economies of scale. There should be a public bank established to ensure that this happens. Water rights and electricity held privately should be compulsorily acquired and managed for the good of the people who live here, not to maximise the investment potential, especially for Chinese State owned enterprises that through their Yang guizi I%ers that fill the boards of such companies, with decarbonisation as a marketing tool. For those who disagree with my view as to the place for inorganically constructed wind and solar, I have no objection as to their manufacture as long as it is done locally by government owned companies. I have a similar view as to this as Prof. Happer.There should be banning of the sale of residential property to non residents, the currency should not be debased as a matter of course, savings should be encouraged and seed capital established other than by taking a loan from a private bank. – My 2 cents

      • I note that the passage as to SA renewables neglected to say anything about the diesel generators, the Victorian Brown coal or that the costs were 50% above the coal burning states. Perhaps that report is not all that balanced. Those minor problems appear to have been “dreamed” away.

          • The magical fairy at the bottom of the garden will make it for us, just like they are going to make all the renewable energy infrastructure for the scientists linked above in the next 15 years. OR we will continue along mostly as we already are, and mostly be OK, until we aren’t.
            My money is on the latter to actually happen.

          • My money is on the latter to actually happen.

            So long as people like you are calling the shots, probably.

            But better to try and fail, than not try at all.

          • kierans777MEMBER

            > But better to try and fail, than not try at all.

            @drsmithy I agree with that. While technology may stop us returning to the complete stone age it’s going to be very rough on the way down unless we as a society come to grips with a few basic facts (eg: that infinite growth is impossible). The work done by the Post Carbon Institute on “Our Renewable Future” I thought was one of the best attempts to plan our way into a positive future instead of collapsing. The question is how much more corruption and stupidity will Australia put up with before there are pitchforks in the street?

      • Mining BoganMEMBER

        Hey, that’s what Scummo said! No subsidies for EVs because nobody is driving them. Be a waste of time.

        If it hasn’t happened, it never will , no matter how much you help it along.

  8. Jumping jack flash

    I just want a subsidy for my Powerwall.

    Solar panels are cheap. Batteries and inverters not so much

  9. Can’t convert to renewables, EVs and hydrogen fast enough…!

    So many naysayers, too – not reading enough to realise that, whilst they are saying it can’t happen, it’s very much happening under their nose, and at an astonishing rate…

      • darklydrawlMEMBER

        Really? I have seen plenty of Tesla’s (often 1 or 2 per outing) – mainly S and X’s, but the 3’s are getting more common. Not every 2nd car, but enough of them to realise they’re doing ok in Oz, despite all of the barriers they have to overcome vs other markets – I think they will sell plenty of the Y’s when they are available here (subject to FX et al).

        Caveat: I suspect It would depend where you travel. I live and work in the type of Melbourne suburbs where you are more likely to see Teslas / EV’s. I suspect there are large parts of Melbourne where you could travel all week and not spot one.

      • With respect, you’re attacking a straw man,

        I didn’t just mention EVs.

        And, I’m not looking at how things are, as you have referred to – I’m looking at how fast they’re changing, and quickly shaping to change – so you can’t refer to the status quo to discredit what I’m saying.

        I’d assert that the trends are quite clear, and not just for the wealthy (because I’m not just talking about EVs).