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Husic warns the energy Czars

Manufacturing News

Industry minister Ed Husic has hit out at energy companies threatening to renege on a deal between the federal government and gas producers to increase the supply of gas to east coast markets.

Interviewed by Patricia Karvelas on ABC radio, Husic said the companies would ‘need to consider their steps very carefully’.

He said: “What we are trying to do in the national economic interest is moderate the pricing.

“These companies have made big profits when gas prices were way lower, and they can continue to make profits and we understand that, but we have a responsibility as a Government for the broader community as well.”

Asked about Shell’s suspension of its involvement in the deal with the government, Husic listed the ‘extraordinary’ profits being made by the gas producers who are benefitting from ballooning gas prices due to Russia’s invasion of Ukraine.

Husic said: “This is the same Shell that had a third-quarter profit of nearly $7 billion, which was up from around $477 million loss the equivalent quarter the previous year.

“…Woodside, their profit increased about 400 per cent, nearly US$2 billion.

“Santos, their half-year profits, up to nearly $2 billion, up 230 per cent.”

Husic said the share price of Woodside and Santos had risen after the government announced a deal with the states to cap the price of gas.

“All the predictions that the world would end haven’t occurred.”

Karvelas asked whether the deal with the states constituted ‘a material change in circumstances’ which would allow the companies to reopen negotiations with Canberra.

Husic said: “We’ve flagged for six months and I’ve spoken to your good self over the last few months about the impact that their pricing is having on the broader economy and community.

“We have said we need to get more reasonable pricing, we’ve also said we’ll introduce a mandatory code.

“We also said, and I made the point a number of times.”

Husic said the government respected that companies need to make a profit, and needed to make a reasonable rate of return.

But he rejected the companies view that the deal with the states was a shock or a threat.

“There are broader Australian companies that need a fairer deal so they can make a profit, they can secure jobs, and again we’ll do what is right in the national economic interest and we would expect that others recognise that and act accordingly.”

Picture: Ed Husic

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