‘I’ll buy your house’: Andrew Liveris ridiculed over gas price claims
A leading energy analyst has challenged Morrison government adviser Andrew Liveris to put some of his last $100m corporate pay cheque where his mouth is.
Andrew Liveris, a gas adviser to the Morrison government, has been ridiculed by one of Australia’s top energy analysts for maintaining $4 a gigajoule gas is a feasible target for users on Australia’s east coast.
The National Covid Co-ordination Commission’s manufacturing taskforce, chaired by Mr Liveris, recommended earlier this year the federal government take immediate action to create an Australian energy market that can replicate the US with gas available at just $4GJ, more than half current levels.
The former boss of Dow Chemical repeated the line on Wednesday saying the $4/GJ target was indeed achievable. He noted if a manufacturer was prepared to commit to investing in a new plant based on the ability to access a lower long-term gas price, suppliers should step up to make offers and if they didn’t “then shame on them”.
MST Marquee analyst Mark Samter told clients Mr Liveris’ remarks deserved a gold medal for the most stupid comment ever made publicly, and had sparked an offer to the Australian businessman.
“From what I can see he got paid ~$100m in just his last year alone as CEO of Dow. Now capital is pretty hard to come by for exploration and production companies these days so, how about, if the economics are so great to sell gas to manufactures at $4/GJ, he puts a measly half of that money into one of these projects. If they make money at $4/GJ then he will be providing more than 12.5 petajoules to the market, enough to run a fertiliser plant for a whole year, or the equivalent of 2 per cent of the entire east coast market,” Mr Samter said.
“How philanthropic that would be, not to mention presumably lucrative. Indeed, if he isn’t willing to do it, one might be quite tempted to say shame on him? What is more, perhaps those manufacturers could join him, given the logic to sanction these projects is so shamefully obvious?”
The energy industry has rejected the $4GJ gas price objective as unrealistic, maintaining it costs more than that to simply extract the resource.
But Mr Liveris, a director of resources engineer Worley, said these claims were based on incomplete data, and that his manufacturing taskforce’s work across the industry – which he said included information that was considered commercial in confidence and therefore not publicly shared – suggested that the $4/GJ target was achievable, given the right settings.
Mr Samter said he had spoken to his wife and they had agreed to pay $20,000 to buy Mr Liveris’ primary residence from him.
Mrs Samter “is a logical lady, so she is confident such an upstanding member of the Australian business community would apply the same logic to this transaction as he did to the gas market yesterday and sell to us – after all, manufacturers need 100 per cent certainty, with no risk, on economic transactions, but why would anyone else be expected to bring financial logic into their transactions if someone is willing to come to the table, right?,” Mr Samter said.
“So shame on Mr Liveris if I am not soon the proud owner of his primary residence. I assume he is also using his seat at the Worley board table to suggest they do work for free on Australian gas projects to make sure those manufacturers who have ‘come to the table’ get their gas?”
Mr Liveris said on Wednesday his conversations with gas-hungry manufacturers – including producers of cement, fertiliser and explosives – showed reliable gas supplied at $6GJ would make the difference between companies choosing to invest in new plants locally rather than offshore. At $4GJ, these manufacturers “would actually expand for export”.
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