Western Australia: A Highly Competitive Destination For Private Sector Investment In The Offshore Petroleum Industry.

Abstract

Abstract The paper provides an overview of Western Australia as a highly competitive destination for private sector investment in the offshore petroleum industry. Australia is a politically stable, English speaking democracy, enjoying sound and consistent economic growth, located in close proximity to major Asian markets. The State of Western Australia occupies the resource-rich western third of the Australian continent. Western Australia's economy is forecast to grow in excess of 5% per annum to the year 2000 and beyond. Western Australia is one of the world's major mineral provinces and one of the largest traders in resources. There are some 300 operational mining and petroleum projects. Western Australia is the country's premier petroleum producer and is the site of the largest natural resource project in Australia - the North West Shelf gas project. Described by industry sources as in a similar stage of development as the Gulf of Mexico 40 years ago, Western Australia already accounts for half of Australia's total crude oil, condensate and natural gas production, and produces 10% of the world's LNG. In 1996/97 the value of oil, condensate and natural gas production in Western Australia increased 24% to US$3.4 billion. The Western Australian State Government actively encourages private sector resource development. Major projects are coordinated by the State Government Department of Resources Development. The State Government is well advanced in its program to deregulate the State's energy sector, providing enhanced opportunities for the exploration, production and sale of gas into the growing domestic industrial market. Proven hydrocarbon reserves offshore have recently been significantly upgraded. Major expansion and development of gas production and processing is planned. LNG production is projected to double by 2005 and development of a greenfields petrochemical industry, using expanded supplies of gas, is planned. Western Australia - Overview Australia is a politically and economically stable English speaking democracy located in close proximity to the world's fastest growing and developing economic regions - the Asia Pacific and Indian Ocean rim regions. Western Australia occupies the resource rich Western third of the Australian continent, and has consistently led the nation - and other developed economies - in key indicators of economic growth, productivity, investment and exports. For example, the State's economy has grown at over five percent per year since 1993, which is above the national figure (three percent in 1997) and higher than the OECD average economic growth rate. The state covers an area of 2.5 million square kilometres with a population of 1.8 million. Despite its large expanse the majority of the State's population are clustered in the south west corner of the State with 1.3 million living in the capital city of Perth. The other major towns in the State have populations of up to 35,000, reflecting the concentration of people in Perth. Western Australia's world scale resource and agricultural industries dominate the State's economy, and contribute significantly to national prosperity. With around 10% of Australia's population, the State consistently produces a quarter of Australia's exports.