The Chief Executive Officer of Beach Energy, Morné Engelbrecht, says that the so-called “reasonable price provision” touted by the Commonwealth Government will cause irreparable damage to the investment environment desperately needed for gas exploration and development, and in turn energy security and future prices in Australia.
“This unprecedented move goes well beyond the temporary price-cap, which itself will damage the investment environment in Australia, leading to more gas shortages and higher power prices in the long term.
“How can the Government expect to impose a regulated price on gas exploration and development where significant upfront capital investment, exploration success risk and the multi-decade nature of projects are par for the course?
“If the energy market is subjected to permanent pricing intervention, the government must be upfront about whether other industries will have their “reasonable price” determined by the government as well.
“Should the government set a reasonable price for large household expense items such as groceries and motor vehicles?
“The answer to this question is of course ‘no’, and the same must be said for temporary or permanent meddling in the energy market, which is under threat of being completely dismantled.
“Instead, the answer to this crisis is right under everyone’s noses; work with us to increase gas supply which will bring downward pressure to energy prices.”
