News & Media

The Australian president of global oil and gas major Chevron has told a business audience that his bosses are confused and frustrated by Australian regulatory settings.

Speaking at a function in Perth this morning, Balaji Krisnamurthy said evolving investment conditions in Australia were cause for consternation at Chevron’s Houston headquarters.

Chevron has invested more than $80 billion in Australia at its Gorgon and Wheatstone projects off the North West coast of WA.

Asked whether Chevron would pull the investment trigger on a project like Gorgon, which is located in an A-class nature reserve on Barrow Island, in the current Australian investment climate, Mr Krisnamurthy put the challenge back on policymakers.

“For Gorgon, the single-largest resource development this country has seen, it took a lot of political courage,” he said.

“In fact, the story has it that several ministers were involved in working with regulators to make it happen.

“It is so easy to say no, in today’s world. It is much harder to say yes and stand up an approve a project.”

The Chevron boss said current day politicians could take lessons from those who paved the way for Gorgon’s development after its approval in 2009.

“We are standing on the shoulders of people who had the courage to do that,” he said of the Gorgon decision.

The commentary comes amid debate over a federal 20 per cent gas reservation policy for LNG producers, which was announced in the Albanese government’s budget last month.

The details of that scheme, and whether it would cancel out the existing WA reservation scheme, have been points of public discussion.

A 25 per cent tax on LNG production was also floated pre-budget but has not been introduced despite strong campaigns from some parties.

Mr Krishnamurthy urged long-term thinking in policy direction, and likened the recent dialogue to “changing the rules of the game at the halfway point”.

He reminded policymakers that Chevron’s capital was competing globally, and said the government’s regulatory tweaks had not been well received at head office.

“They are confused and frustrated, I would say,” Mr Krisnamurthy said.

“I think we have seen over the last few years, and it has spanned multiple governments to be fair, but we have seen this intervention in markets in one form or another.

“This domestic gas conversation is one such conversation.

“No one thing alone creates that level of frustration where it impacts the investment climate, but when you put it all together as this constant conversation … the cumulative impact really erodes investor confidence.”

Chevron and its joint venture partners at Gorgon took a $3 billion final investment decision on stage three of Gorgon in December last year.

The company has capacity for significant expansion at its Wheatstone facility including new trains and a new berth at the Port of Ashburton.

Mr Krishnamurthy has run Chevron Australia for around 12 months, and has previously worked in jurisdictions including Canada, Kazakhstan and in Chevron’s offices in California and Texas.