Woodside petroleum Ltd chief executive Don Voelte says the goal of tripling liquefied natural gas (LNG) production in Australia by the end of the next decade is unattainable.

“There is simple not enough available people and equipment to treble LNG output by 2017 and a reality check is needed” says Voelte. This was in response to comments made at the Australian Petroleum and Production and Exploration (APPEA) conference in Perth this week that the nation could triple its LNG output by as early as 2017.

He also said initiatives that would make LNG production targets achievable included relaxing the criteria for guest worker program.

“Greater access to more skilled workers such as electricians and pipe technicians was badly needed.
He said while the speeding up of immigration procedures would bring in skills more quickly, background checks were necessary to protect Australian citizens.

“There has to be more EPC (engineering, procurement and construction) contractors … and a new generation of offshore construction equipment and pipeline facilities”.

He said it would not be achieved “without real action on the part of both industry and government to get projects off the drawing boards”.

“We won’t throw up our hands and say the challenges are too great. We believe the industry strategy sets out a positive work program over the next nine years to achieve real outcomes and more LNG.”
“We have the gas reserves and the opportunities to treble LNG production by 2017.”
“Whether we do so is up to companies and governments.”

There is now $100 billion worth of LNG projects being planned in Australia including the Gorgon, Browse, Ichthys, Wheatstone, Pilbara, Gladstone and Darwin Phase 2 LNG projects.

APPEA wants LNG production capacity to increase from its 2008 level of 20 million tonnes a year to at least 50 million to 60 million tonnes (Mt) a year.

Australia’s commitment to the Kyoto Protocol threatened to undermine its ability to compete internationally with exports such as LNG, Veolte warned.

He said Australia’s LNG exports were competing with nations including Qatar, Indonesia and Trinidad and Tobago, which were not signatories to the Kyoto Protocol - and don’t plan to be - and therefore would not impose a carbon tax.

“People won’t pay a premium - if they can get it cheaper elsewhere, they will,” Voelte said.

“Somehow, we have to transition this so it doesn’t make Australian products uneconomic out there.”