Mr Ferguson outlined three key policy areas the Federal Government was targeting to assist the development of Australia’s petroleum industry; tax, national offshore regulation and new acreage.

Resource Super Profit Tax

Earlier this month the Federal Government announced it would implement a uniform 40 per cent tax to profits from resource projects after allowing for extraction costs and recouping capital investment. The Resource Super Tax (RSPT) is set to apply from 1 July 2012.

Flagging the high level of concern that the Government’s proposed changes to the resource sector’s taxation regime had generated in the industry, APPEA Chief Executive Belinda Robinson said “The impact, the necessity for, and the detail of the Government’s proposal for a resources super tax is certain to be front and centre of the APPEA Conference both in the corridors and in the formal presentations.

In his address Mr Ferguson sought to allay concerns about the tax stating that his Government was committed to a genuine consultation process and also confirmed that the resources offshore already covered under the Petroleum Resource Rent Tax (PRRT) – such as Bass Strait or Pluto – and those that would be covered under the PRRT – such as Browse or Wheatstone – would continue to be covered under the PRRT.

“We share a common goal – a stable fiscal regime that delivers both a fair return for your shareholders and a fair return for the Australian community from the nation's resources,” Mr Ferguson said.

In the lead-up to the conference Ms Robinson said that the intention to introduce a resources super tax has had a very destabilising impact on the industry.

“Certainty over the long-term design of Australia’s taxation regime that incorporates an accurate and fair reflection of the magnitude of the risk and capital investment involved in this industry, is absolutely critical to these projects moving forward in the timeframe anticipated," said Ms Robinson.

Woodside Petroleum Chief Executive Don Voelte said that the ability for Woodside to raise capital was essential if the company’s $60 billion in projects planned over the next decade is to go ahead.

On the issue of consultation, Mr Voelte has reportedly told attendees at a Perth business function last week that the Rudd Government had not spoken to the company about the tax, which he said would prevent companies in Australia from raising any substantial capital for major projects.

Comet Ridge Chief Executive Tor McCaul said that his company was going ahead with coal seam gas (CSG) exploration plans in Queensland’s Galilee Basin despite the RSPT.

Mr McCaul said that the tax is more likely to affect bigger CSG companies heading toward final investment decisions in the region. “Our feeling at the moment is they will be more at risk of putting down tools and not going ahead just given the sort of magnitude of the projects they’re proposing,” said Mr McCaul.

National offshore regulation

Mr Ferguson congratulated the industry on the launch of the new and innovative Common Safety Training Program requiring all new entrants to offshore drilling and production facilities.

Mr Ferguson stressed the importance of having a world-class regulatory system in place and competent and professional operators in the industry particularly in light of the Varanus Island pipeline rupture, which occurred offshore Western Australia in June 2008 and PTTEP Australasia’s offshore oil spill, which occurred in August 2009 at its Montara Oil Field located in the Timor Sea.

“Our approach must be to ensure our oil and gas exploration and production operations are the best and safest in the world,” Mr Ferguson said. Mr Ferguson also spoke of the Federal Government’s plan to deliver a single national regulator for offshore petroleum projects.

“It is clear that regulatory overlaps and inconsistencies in the application of the offshore petroleum legislation across jurisdictions must be addressed if we are to improve safety and environmental performance.

“My preferred model is consistent with the industry's view that the safety of people, the integrity of facilities, the protection of the environment, and day to day operations must be regulated in an integrated way, with resource management issues regulated separately,” Mr Ferguson said.

New Acreage

Mr Ferguson also announced the 2010 Offshore Petroleum Exploration Acreage Release.

There are 31 areas across five basins on offer this year, which vary in size, known prospectivity, water depth and level of existing geological data and knowledge. Mr Ferguson congratulated APPEA on its 50 years of service to the industry and said “By working together we can achieve a stronger, more resilient, more competitive industry for the next 50 years and beyond.”