Australian Energy Supply and Investment (with Paul Allen)

Aussie energy producer navigates domestic fuel insecurity by boosting local supply. Capex strategy is highly defensive, stress-testing for oil price downside, not chasing geopolitical rallies. The key risk isn't the Middle East, it's Canberra. Talk of retrospective taxes & export caps is killing investment appetite, creating a long-term bullish setup for domestic energy prices as future supply is choked off.

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Brett Woods 6.0

Australian Energy Supply and Investment (with Paul Allen)

How is the geopolitical upheaval impacting your decision-making?

Paul Allen
Brett Woods

The challenge is fundamentally about the supply chain, making sure we have enough diesel. Australia is short of liquid fuels, so 100% of our oil production is being devoted to domestic refineries. We have increased drilling to help support fuel security.

We've gone from six refineries down to two, exposing Australia in terms of fuel security.
What are the risks for these investments if there is a quick solve in the Middle East?

Paul Allen
Brett Woods

We make sure we execute stuff that stays free cash flow positive even if there is a drastic deviation to oil price. We are picking through our inventory of opportunities to make sure we are defended on the low side. We can't throw everything at it, otherwise you'll stress the balance sheet.
How are you navigating the regulatory uncertainty with the potential changes to the petroleum resource rent tax?

Paul Allen
Brett Woods

We've had different ministers say drastically different things. The suggestion of a retrospective 20% reservation of exports for the domestic market will drive investment signals away from projects like ours. You may get a short-term benefit for manufacturing, but without constant investment, prices will return to much higher levels.

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