Natural gas is taking an increasingly central role in global energy supply, and this is certain to continue into the future. Much effort is going into development of cost efficient methods to take gas from source to market. One of the areas in which breakthroughs have been realised is the gas to liquids technology.

For a major gas resource holder like Australia this creates opportunities as well as challenges. On the one hand does GTL fit with the strategic drivers:

  • to maximise the value from the gas for the Australian people, including through exports

  • to diversify the country's energy supply

  • to increase the supply of environmentally clean fuels, into the country in a cost effective manner.

On the other hand there is the reality that Australia is characterised by high, remote location, construction and operating costs compared to other countries. In a world where investment flows to places where it can generate the most returns, this presents the Australian Government with a considerable challenge.

This is (partly) offset by the fact that Australia is very attractive because of its stable investment climate.

This paper addresses the opportunities and dilemmas which Australia is facing and explains the action the Australian government has and will take to encourage GTL investments in Australia.


Australia's large reserves of natural gas, which are currently under-utilised, are used to supply the domestic and export markets. A national gas pipeline network is emerging in Australia.

Over the last 20 years Australia has monetised its remote gas resources via LNG, virtually all of which is exported. There remains significant potential to expand our LNG industry subject to the adequacy of export markets.

Now that GTL technology is virtually proven, Australia's challenge over the next 20 years will be to further monetise our stranded gas resources, using the GTL fuel route and associated industries including methanol and dimethyl ether. GTL development should enable us to fill the shortfall in our liquid fuels output resulting from Australia's declining self-sufficiency in oil; also to supply markets in the Asia Pacific region and to meet requirements for increasingly cleaner fuels.

Australia has an enviable history in the successful development of its abundant natural resources. It has a long mining tradition and is well aware of the significant benefits that resource development offers our economy and trade. The minerals and petroleum industries continue to generate a high proportion of the nation's export income amounting to over 63 per cent of Australia's total exports of goods and services.

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The Australian Government is working hard to continue to ensure a competitive envi

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