CHRIS SMITH: Energy Minister Angus Taylor will today announce that the Morrison Government is bringing forward support for local oil refineries as part of its commitment to jobs, affordable fuel, and Australia's long term fuel security. It's hoped the production payments will help the industry withstand the economic shock of the COVID-19 pandemic, which continues to place immense pressure on our refineries and the many Australians employed in the fuel industry. The move follows weeks of talks with unions and refinery operators who warn plants could be forced to shut amid mounting losses. Energy Minister Angus Taylor joins us now. Minister, welcome. 

ANGUS TAYLOR: Thanks for having me, Chris. 

CHRIS SMITH: So tell us about this support package - what's it worth and who does it cover?

ANGUS TAYLOR: Well, it's worth just under $84 million. It covers our fuel refineries, and essentially it is a production payment that recognises the important role they play in fuel security. So we announced a package before the budget which was about shoring up our fuel security in this country. One part of that is focussed on our fuel refineries and giving them every chance of prospering in a very tough environment. COVID has been extremely difficult for our fuel refineries, and this is a payment that recognises the role they play in our fuel security. It's alongside other initiatives that include supporting the build of new storages for fuel and a mandatory minimum stockholding obligation for fuel distributors. So all of that is combined to put us in a position where we have the fuel when we need it. We've been lucky through the pandemic, Chris. Things have gone alright in terms of fuel security, but it's been a very tough time for our refineries. And I know this will start from the 1st of January and will be welcome from the refineries who'll take it up. 

CHRIS SMITH: But you're propping up an industry that's running at a loss. What's to say that in 12 months’ time, they'll be asking for another $84 million?

ANGUS TAYLOR: Well, this is a permanent payment, and it's bringing forward to 1 January. It's simply recognising the role they play in fuel security. So the truth is that for many, many years, our refineries have played an important role in ensuring that we have the fuel we need when we need it. So a farmer who is in harvest, and of course harvest is happening right now and has been happening for some time, they need to know that the fuel is going to be there. If you're a truckie and you've got to move a container from Melbourne to Sydney, you've got to know that the diesel is going to be there to fill up your truck. So these are really essential services required for all Australians. The refineries play a role in that. Our alternative is to hold a whole lot more stock which is expensive. So this is simply recognising the role that the refineries play at a time when refineries all around the world are struggling, and particularly in Victoria right now because of the lockdowns there, there's been limited offtake for them. It's been an extremely difficult time. But this is an ongoing payment to recognise the role they play in our energy system.

CHRIS SMITH: And to ensure that if there's trouble on a world scale, we can be self-sufficient in terms of our oil supplies, right?

ANGUS TAYLOR: Well, that's exactly right. The best form of self-sufficiency is being able to extract our own oil from places like Bass Strait or the Cooper Basin or increasingly the Northern Territory - the Beetaloo basin - and being able to refine that onshore. Then you have an unlimited supply to the extent that you can do that. So that's our best form of defence against the kind of scenario you just outlined. Of course, stocks is another way, but it's never going to be as good as having your own fuel production and your own fuel refinery. So we're seeking to recognise the role that those fuel refineries play in giving us the fuel we need. And look, we've been blessed in this country. Some of your listeners will remember the odds and evens back in the 70s. 

CHRIS SMITH: Yeah. 

ANGUS TAYLOR: But this has been an issue in the past, but we've done extremely well. This is all about making sure that we do have that fuel security we need.

CHRIS SMITH: Angus Taylor, thank you very much for your time. 

ANGUS TAYLOR: Thanks, Chris. 

Media contact:

Minister Taylor's office: 02 6277 7120