news conference introductory remarks catherine tanna - QGC

NEWS CONFERENCE INTRODUCTORY REMARKSCATHERINE TANNAEXECUTIVE VICE PRESIDENT, BG GROUPMANAGING DIRECTOR, QGC PTY LIMITEDI am Catherine Tanna, Executive Vice President of BG Group and Managing Director of QGC, BG Group’sAustralian subsidiary.For those you who don’t know me, I am a Queenslander and a Gladstone girl.May I welcome the Acting Prime Minister, Wayne Swan; the Federal Minister for Resources, Energy andTourism, Martin Ferguson; the Mayor of the Western Downs Regional Council, Ray Brown; and the actingMayor of the Gladstone Regional Council, Gail Sellers.I also offer an apology for the Queensland Premier, Anna Bligh, and other members of her governmentwho are in Mt Isa today for a long-standing commitment to community cabinet.I am announcing, on behalf of BG Group, our approval in London over the weekend to commit US$15billion to developing the Queensland Curtis LNG Project.This is the single biggest investment ever undertaken by BG Group, one of the United Kingdom’s largestcompanies, with operations in 25 countries.Three years ago, when BG Group set up in Australia, we had an idea.Today, we have a project.Over the next four years, we will build the world’s first liquefied natural gas plant to use coal seam gas as afeedstock.In doing so, we will create a new industry for Queensland.We think it is a good day for Queensland and a good day for Australia.The Queensland Curtis LNG Project involves building a liquefied natural gas plant at Gladstone, a 540kmunderground pipeline network, and expanding production in gas fields in the Surat Basin around Chinchilla.The project will have an operating life of at least 20 years.We have scheduled first LNG shipments from Gladstone in 2014.We have binding commitments with LNG customers in China, Japan, Singapore and Chile, and we will alsocontinue to provide gas to markets in eastern Australia.Over the next four years, the project will create an estimated 5000 construction jobs and, from 2014, nearly1000 jobs in operations.We estimate that the project will increase economic activity in Queensland by A$32 billion over the project’sfirst decade, or A$2.6 billion a year.We also expect to pay about A$1 billion a year in federal taxes and a further A$300 million or so each yearin royalties to the Queensland Government.Critically, this project – and the new industry it spawns – will provide a sustainable future for many regionalQueensland towns and communities which, without this sort of development, may continue to decline.We expect about half of the project’s total capital outlay over the next four years to be spent with Queenslandand Australian firms and for about 80% of operating expenditure over the next 20 years to be spent locally.Project benefits will include treatment of saline water produced with the gas for its re-use in local agriculture,towns and industry in the Surat Basin.31 October 2010 1

The LNG plant will be the most greenhouse gas efficient in Australia and the second-most efficient in theworld.LNG from our plant will generate about 35% less greenhouse gas emissions than other fossil fuels.Environmental approval for the project, under Queensland and Federal legislation, has taken account of themany community contributions and challenges detailed in our environmental and social impact assessment.Our project approvals include about 1500 conditions and the requirement for more than 800 productionlicences, safety certificates and other environmental permits ranging from pipelines to land access to gastenements.In summary, I make four key points.First, projects of this scale, complexity and detail are incredibly difficult.They involve marketing, exploration, engineering and operating skills that must be world class.This project, in particular, is especially challenging because of its pioneering status and its vast array ofcompeting stakeholder interests.It is a credit to many, many capable people within our company, and within local, state and federalgovernments that we have achieved today’s result.Second, these are long-term projects that will most likely outlast the working lives of us all and will transcendpolitical cycles.In this context, we have a special obligation to the communities in which we operate as we bring new jobs,new industry and new infrastructure that otherwise would not occur.With that change, we have a responsibility to maintain – and to improve – the jobs, industry andinfrastructure we create because we have become more than just visitors.We are now neighbours.Third, we are determined to co-exist with our neighbours – farmers, townspeople, miners, conservationists,traditional custodians, business, and governments.We have not been deaf or blind to the fears that some hold about our potential impact.We will bring change – and we will also bring responsibility to the land, the air, the water, and therelationships we have with our neighbours.We see no benefit in working against the best interests of our community and, indeed, it makes no sense todo so.Fourth, we are determined to do the right thing.Our decision to proceed follows nearly three years of rigorous regulatory and public review and discussionswith more than 4000 individuals, landholders, indigenous groups, conservationists, industry associations,regional councils and government agencies.Their contributions have played a key role in shaping our commitments, and government regulations, that willserve to ensure this project is good for the environment, good for people, and good for Australia.In closing, we acknowledge the support and assistance of the Queensland and CommonwealthGovernments, particularly the Premier and her Government, and the Acting Prime Minister and the FederalGovernment and, in particular, his colleague, the Minister for Resources, Energy and Tourism.I also pay particular tribute to QGC staff and contractors for their efforts over the past three years.They have much to be proud of today.31 October 2010 2