04/12/2008 - 10:20

Govt to hold another Varanus inquiry

04/12/2008 - 10:20

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The DomGas Alliance has today welcomed the Senate's report into the Varanus Island gas pipeline explosion while the state government confirmed plans to hold a further independent inquiry.

Govt to hold another Varanus inquiry

The DomGas Alliance has today welcomed the Senate's report into the Varanus Island gas pipeline explosion while the state government confirmed plans to hold a further independent inquiry.

DomGas, which represents the state's biggest gas users such as Alinta, Burrup Fertilisers and Horizon Power, said it welcomed the Senate's reference for greater competition, diversity and security of gas supply in WA.

The intense scrutiny of WA's gas supplies was prompted by a June 3 pipeline explosion at Apache Energy's Varanus Island facility, which cut the state's gas supply by a third.

Partial production at the facility resumed in August and full production is expected to be back online this week.

Yesterday, the Senate's report concluded there was no evidence that there was a large impact on employment or on the economy, and that the previous government's response to the crisis was "professional and effective".

The report also referred to WA's lack of "mature, diverse and competitive market" with regards to energy supplies.

"The reliance on limited sources of gas production and supply for the domestic market is a significant impediment to the continuity of supply of energy for Western Australian consumers and industry," the report concluded.

"There is no short-term capacity to provide significant amounts of reliable and affordable supplies of alternative energy sufficient to mitigate against a similar crisis if another major gas failure is experienced."

The Senate's findings follows a report released by DomGas last week that called for the adoption of a fiscal incentive package that will encourage domestic gas supply and take away the current focus on exports.

Meanwhile, Mines and Petroleum Minister Norman Moore has reaffirmed state government plans to hold an independent inquiry into the gas pipeline explosion.

"It is a given that there is a need to hold an independent inquiry to look into the role of the regulators of the Varanus Island facility," Mr Moore said.

"The Senate Inquiry .... looked into issues subsequent to the circumstances which led to the pipeline explosion on Varanus Island.

"This State Government will need to look at the conclusions and recommendations of the Senate Inquiry report closely to see if further investigations are necessary.

"The terms of reference of the independent inquiry will be announced once we have had time to fully digest the Senate Inquiry's report."

 

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