LABOR UNDER FIRE OVER GAS AS QENOS ADDS TO MANUFACTURING...

LABOR UNDER FIRE OVER GAS AS QENOS ADDS TO MANUFACTURING WOES
Nick Evans - Perry Williams
The federal opposition has slammed the Albanese government’s lack of action on gas prices as major plastics manufacturer Qenos prepares to shut up shop in Victoria and NSW.

Opposition energy spokesman Ted O’Brien said Labor’s focus on the renewable energy rollout was “trashing Australia’s comparative advantage” as energy-intensive companies such as Qenos that also relied on gas as a feedstock were forced to close down as a result of high energy and gas prices.

“My heart goes out to the hundreds of workers who face job losses due to this decision and their families, who are innocent victims of Labor’s ideological attack on gas, which is forcing manufacturers to the wall due to high energy prices,” he said.

Mr O’Brien’s comments came after The Australian revealed that Qenos’s Chinese owners had struck a deal with industrial and logistics property developer Logos for the sale of the company, seen as a prelude to the closure of its manufacturing plants by the end of 2024.

Qenos is yet to confirm or deny its plans to shut, first reported by The Australian in late February.

Qenos is not believed to have made any direct approaches to either the Victorian or federal government, but is understood to have been discussing its future plans after The Australian’s February report that the company was quietly preparing to close its operations by the end of 2024.

Both the Victorian government and federal Industry Minister Ed Husic declined to comment on Thursday.

The Victorian government is facing growing pressure to reconsider its ban on onshore gas exploration in the face of looming gas shortfalls as Bass Strait production dwindles.

But the state’s Labor government, in power for a decade, has also enshrined a ban on onshore gas fracking in the state’s constitution and has led opposition to the fuel source being included in an east coast Capacity Investment Scheme.

The exit of Qenos from the gas market would offer some relief, with the company’s last gas contract with Woodside accounting for about 4.5 petajoules of gas in 2023.

Victorian opposition energy spokesman David Davis said Qenos had long played a central role in Australia’s manufacturing sector and said the state government’s energy policy was driving major manufacturers out of the state.

“The frightening surge in taxes, energy costs and regulation in Victoria risks making us uncompetitive. A firm like Qenos uses gas as both a feedstock and an energy source and has been hit hard by the surge in energy costs under Victorian Labor. Security of gas supply is also critical,” he said.

“Labor’s botched gas policy is a significant impediment and must be reversed if businesses are to survive and compete.”

Mr O’Brien said the Albanese government should refocus on Australia’s traditional strengths rather than run a “radical experiment to reform our industrial base away from energy-intensive manufacturing to shiny new ideas like competing head to head with the likes of China on producing solar panels”.

“Australia is at threat of haemorrhaging its sovereign manufacturing capability because Labor is refusing to take energy security seriously. As a nation awash with gas, it’s heartbreaking that Labor is strangling supply to the point that manufacturers are losing confidence about their future and looking at closing their doors,” he said.

“I fear that Labor is rapidly turning our supply of energy from a national strength into a weakness which is fast eroding our competitiveness and productivity.”

Warnings by the Australian Energy Market Operator of significant gas shortfalls by 2025 have also led to renewed pressure for the reservation of Queensland LNG production for the domestic market, rather than speeding up gas exploration and production in states such as Victoria.