SMH: Anxiety over Australian gas exports

It's been difficult to miss the growing anxiety expressed by Australia's senior oil and gas executives over the past few weeks. To just about a man they have released extraordinary cost blowouts and aimed serious criticism at Australia's industrial relations system. There is more today from Michael Chaney, chairman of National Australia Bank and Woodside Petroleum.

Australia is likely to fall off a "growth cliff" when the resources investment boom ends in the next few years because the economy is not becoming more productive, Mr Chaney says.

Economic growth was likely to slow to less than 2.5 per cent after 2015 because of burdens on business, including overlapping state and federal environmental regulations, and Labor's industrial relations system, which made the workplace less flexible, along with other problems, he said.

David Knox, CEO of Santos, chimed in with similar arguments today. There is no doubt that labour costs have soared as Australia undertook 70 per cent of the world's liquefied natural gas capacity building in the past few years. But labour is only a serious issue during construction. For decades afterwards, labour inputs fall, a lot. And although the executive refrain about labour costs is absolutely right, it is, in fact, the tip of the iceberg when it comes to the growing challenges confronting Australian LNG. MORE