TOM CONNELL: Victoria has approved its first extraction project in more than a decade, that's despite the State Government's renewable energy push. The pipeline near the Twelve Apostles will supply gas to local homes and businesses, but it could not still address a predicted shortfall. I spoke to the Federal Resources Minister, Madeleine King, a short time ago and began by asking her about how significant this project will be. 

MINISTER MADELEINE KING: It's an important announcement out of Victoria today. The Otway Basin, the coastal waters of Victoria; it's, you know, part of their gas profile, and I think it's an important contribution to Victoria's energy security, but equally Victoria doing a great job in the push to renewables, and I think as the Government there has said and does understand, it is important to have gas to make sure that that push to renewables has an underpinning of energy security. 

TOM CONNELL: Well, how true is that, because there's been an ongoing debate with you and the Victorian Energy Minister. She says there's no onshore gas to develop in Victoria. You say there is. Someone's wrong. 

MINISTER MADELEINE KING: Look, I don't know, I think we've, each of us have been misrepresented in ways around this debate. 

TOM CONNELL: Okay. 

MINISTER MADELEINE KING: Now, I'm not going to, you know, comment on onshore gas reserves in Victoria. Like that is a matter for the Victorian Government, and also ‑‑ 

TOM CONNELL: [Indistinct] whether they exist or not.

MINISTER MADELEINE KING: Well, but the Victorian Geological Survey is the holder of those records. What I am responsible for is offshore gas, offshore Victoria, and I might add that Minister D'Ambrosio and myself work together collaboratively in relation to permitting around that offshore supply, and that's part of the Otway Basin. 

TOM CONNELL: Yeah, that announcement has happened. 

MINISTER MADELEINE KING: And the announcement ‑ yeah, and that Otway Basin, the same with the Gippsland Basin, extends to Commonwealth offshore waters, the coastal waters of Victoria, and it would be reasonable to assume that some of the gas of that Basin is onshore as well. But gas changes between offshore and onshore. 

TOM CONNELL: Okay. So, but you've got this big map we were talking about before that talks about where all the supplies are. So is there some onshore gas in the Victoria part of that? 

MINISTER MADELEINE KING: But that map, and Geoscience Australia's information doesn't necessarily go to the exact quantity and volume of that gas. That is a matter for Victoria. 

TOM CONNELL: So she says essentially companies are not interested in developing it, presumably 'cause it's not big enough or worth it. Is she right or wrong, or you don't know? 

MINISTER MADELEINE KING: Well, traditionally, offshore Victorian gas has been a by‑product of the oil industry, and that's why it was a relatively cheap gas supply, and we know that through the Bass Strait, which is now depleting, which everyone knows, and that's, you know, fairly public knowledge. So there are different drivers for the gas industry in Victoria historically, just as there are for many other industries as well. So what the driver is into the future is going to be different, it's going to cost a bit more because it's not a by‑product of the oil industry, which obviously makes money selling oil and refining fuel, so the need for gas ‑‑ 

TOM CONNELL: Well, now it's the transition that's needed for particular fuels as well. Surely you'd be having conversations around is there onshore gas in Victoria, would you develop it, do you not want to develop it; that's ‑‑ 

MINISTER MADELEINE KING: Well, no, it is a matter for States to decide. 

TOM CONNELL: I know it's a matter for States, but the Federal Government's ‑‑ 

MINISTER MADELEINE KING: And I respect that. 

TOM CONNELL: ‑‑ commented before on, you want to make sure there's supply, that means involving the States. Surely there are conversations about that. 

MINISTER MADELEINE KING: Well, there are, of course there are conversations, but ultimately, you know, I respect the decision‑making processes of my State and Territory colleagues, but the reserves are different right around the country, so obviously in Western Australia it's different to what it is in Queensland, to what it is in New South Wales to what it is in Victoria. 

TOM CONNELL: Okay. 

MINISTER MADELEINE KING: So each State, including Victoria, clearly are going to have to make their own decisions. 

TOM CONNELL: Yep. 

MINISTER MADELEINE KING: Do their own exploration for ‑‑ 

TOM CONNELL: And decisions are one thing, but when you said "misrepresented" before, I'm just trying to sort of clarify here whether you believe there is onshore gas that could be developed in Victoria or not. 

MINISTER MADELEINE KING: Well, we have been misrepresented, that we're having an argument. We're not having an argument. 

TOM CONNELL: Are you saying ‑‑ 

MINISTER MADELEINE KING: The media are saying we're having an argument. 

TOM CONNELL: Okay. Well, let's scrap then, let's put a blank space out there, a fresh page. Do you believe there's, from your information you have, there's onshore gas in Victoria that could be developed and could help the gas supply? 

MINISTER MADELEINE KING: Look, it really is a matter for the Victorian Government to decide whether that's an option, and that knowledge ‑‑ 

TOM CONNELL: But I'm not saying "option", I'm saying whether it's there to develop. 

MINISTER MADELEINE KING: Well, that knowledge resides with the Victorian Geological Survey. 

TOM CONNELL: And you haven't asked the Minister. 

MINISTER MADELEINE KING: Well, I'm not going to go into what their decisions in the long‑term are going to be. What we know of Victoria, and we back this, is they want to move out from a dependency on their energy in brown coal to renewables, and that's really important, and I respect that decision of the Victorian Government, and they're helping their community get there. 

TOM CONNELL: Okay. 

MINISTER MADELEINE KING: So, you know, I respect that, and we happen to support them as well. 

TOM CONNELL: Okay. But it just seems strange you wouldn't even ask if it's there or not. It's not like a State secret, is it? Isn't it good to know and go, "Okay, if we need the gas, we're running short here, Victoria will have it, I can talk to them about whether maybe they should develop it". 

MINISTER MADELEINE KING: As but as I said, it's up to Victoria to whether they want to do that, and what happens in Victoria right now is they process the gas that comes from offshore, so a lot of gas does go through Victoria, and Minister D'Ambrosio's been right to say a lot of that flows through Victoria into New South Wales. That's exactly correct. 

TOM CONNELL: Okay. Processing critical minerals, so a big part of the budget obviously. It doesn't start for a few years, but are there any earlier conversations; are companies already interested in using this?  

MINISTER MADELEINE KING: Absolutely. This is a policy a hundred per cent backed by industry, and it's no wonder. We've been working with industry for some time on establishing what we can best do to drive a critical minerals industry that is affected by market manipulation, and thin markets as well, low‑volume commodities that are just emerging as demand grows for net zero technology. So industry does support it, they enthusiastically support it, and we've worked with them to develop it to this point. 

TOM CONNELL: Any announcements soon? 

MINISTER MADELEINE KING: On [indistinct] itself? 

TOM CONNELL: Yes. 

MINISTER MADELEINE KING: Well, I mean thinking that ‑‑ 

TOM CONNELL: Are companies in doing it all saying, "Yep, we'll be up and running" ‑‑ 

MINISTER MADELEINE KING: Oh, yeah, yeah, absolutely. 

TOM CONNELL: They're coming, are they? 

MINISTER MADELEINE KING: There are companies that are already looking at projects. 

TOM CONNELL: Okay. 

MINISTER MADELEINE KING: And this changes the financing for them, which makes them able to push forward more quickly. 

TOM CONNELL: Okay. Nickel was added, but you know, it's spoken about it being in surplus for a decade, even the processing side, in particular in India, and it's pretty cheap there. If we end up subsidising that, is that going to be a good use of our money given that surplus? 

MINISTER MADELEINE KING: Yeah, well, the thing about the critical minerals list is it's not always about, it's not just about availability, it is about market problems as well. So what we've seen with nickel, while there is supplies of it available, because of international markets, the price has plummeted making it simply uncommercial in almost any respect. So that is what makes that a critical mineral as opposed to something of which there is much less abundance of. So nickel's really important; there's more nickel in a lithium ion battery than there is lithium, and the nickel industry's changed. When it started 50 or 60 years ago it was about nickel for stainless steel, but now it's about nickel for batteries. 

TOM CONNELL: Well, there's plenty of them around and more to come. Carbon capture and storage, so $32 million to develop rules and Trade Agreements in the budget. The big project here that's spoken about in Gorgon has sort of struggled to hit KPIs, globally, it's struggled at scale; how big a part do you think it will play, is it a bit of a question mark, do you think? 

MINISTER MADELEINE KING: Well, in decarbonising the global economy, there are so many tools that have to come into play, and there is no doubt the challenge is so large, 'cause we're for the most part an industrialised world that has built its prosperity on carbon emissions, and we know where that has placed us, endangering the planet, and we have to take action to bring down those emissions to change the trajectory of our planet. So carbon capture and storage is just one potential tool. 

TOM CONNELL: And is that the thing, potential, does that mean you wouldn't throw too many subsidies at it, it's sort of got to stand at its own feet? 

MINISTER MADELEINE KING: Yeah, well, we don't want to throw any subsidies at it. We're doing research into it, and ‑‑ 

TOM CONNELL: You're not looking at subsidies, it would need to stand on its own two feet? 

MINISTER MADELEINE KING: And it does, because the industries that need to lower their emissions are also the ones that are capable of, you know, paying for this technology themselves. 

TOM CONNELL: Okay. 

MINISTER MADELEINE KING: And also have the know how to do it. But on Gorgon, I mean I know it definitely has not met its KPIs, and it has failed in part on the settings set by the State Government of Western Australia, but they have worked that through with the State Government, but it also has sequestered 9 million tonnes of [indistinct]. 

TOM CONNELL: Yeah, it has, it's just the expectation ‑ or the ‑‑ 

MINISTER MADELEINE KING: Oh, the expectations were high, and they haven't met them. 

TOM CONNELL: All right. Minister, thanks for your time. 

MINISTER MADELEINE KING: All right. Thank you.