11 March 2017
The federal government could gain revenue of US$4.8bn ($6.4 bn) from Chevron’s Gorgon gas project between now and 2030 if it made offshore gas projects subject to a royalties regime, according to research from a Monash University academic.
The Tax Justice Network has used an inquiry the government is conducting into the PRRT to argue that it should impose a 10% royalty on all offshore oil and gas projects in Australia to ensure taxpayers start getting a fair return on their natural resources.
Monash University lecturer Diane Kraal, who is conducting research on integrated natural gas-to-liquids projects that extract from basins in commonwealth waters, also favours the imposition of a royalties regime for offshore oil and gas.
She says that in the absence of a royalties regime, the Gorgon project will not pay any PRRT until at least 2030.
Kraal says the PRRT is clearly not working as intended for gas, and imposing commonwealth royalties for offshore projects would be one way of addressing the problem, without creating double taxation.