Australia's Decision to Repeal Carbon Tax Removes Cost Burden on LNG Exporters

Australia’s decision on Thursday to repeal the carbon tax passed by the Labor Party in 2011 will reduce cost burden on LNG exports, according to Australian Petroleum Production & Exploration Association (APPEA).

“Today’s repeal of the carbon pricing mechanism is significant as it removes a cost facing Australian LNG exporters competing in global markets; one that does not exist for our international competitors,” Chief Executive of AAPEA David Byers said Thursday.

Byers said that although surging LNG demand in Asia presents an enormous opportunity for Australia, rising development costs raise doubts about the attractiveness of continued investment in Australian projects. 

“While initiatives are being taken within the industry to address cost competitiveness, it is good to see policy action that removes costs for trade-exposed producers,” Byers commented.

APPEA supports a national climate change policy that delivers emissions reduction at least cost while recognising the greenhouse benefits that flow from a prosperous and vibrant natural gas industry, he added.

“Exporting LNG to the world is one of the most meaningful contributions Australia can make to reduce global greenhouse emissions as natural gas is a much cleaner burning fuel than traditional energy sources,” Byers stated.