15 May, 2017
The Australian government has committed to spend over AU$70 billion ($52 billion) on transport infrastructure across the country by 2021.
Australian's federal budget, announced by treasurer Scott Morrison this week, includes confirmation of a second airport in Sydney, a AU10bn ($7bn) inland rail programme, and AU$20 million to partner with companies in potential fast rail projects, it said.
The Australian government agreed last week to build the second Sydney airport after Sydney Airport Group, Sydney's existing airport operator, turned down the opportunity to finance, build and operate it.
The government will finance a Melbourne to Brisbane Inland Rail project using an additional AU$8.4bn ($6bn) equity investment in the Australian Rail Track Corporation and a Public Private Partnership, it said.
A further AU$472m ($347m) will support a Regional Growth Fund for local infrastructure projects that can make a "real difference to regional economies", the government said.
An Infrastructure and Project Financing Agency will be set up, modelled on a similar body in the United Kingdom, to help the government identify financing solutions and provide advice on implementation.
The federal budget also introduced measures designed to boost energy security, including $90 million to address domestic gas supply issues.
The Australia government recently introduced export restrictions on liquefied natural gas (LNG) to ensure that the domestic market does not run short. Under the Australian Domestic Gas Security Mechanism, Australia's minister for resources will impose export controls based on advice from the market operator and regulator. Exporters that export more than they contribute domestically will be required to outline how they will fill the shortfall of domestic gas as part of their overall production and exports.
A hydroelectric scheme on the snowy Mountains will also be expanded to increase generating capacity by 50% to deliver an extra 2,000 megawatts of renewable energy, and the government will support Tasmania in planning for expanded pumped hydro storage schemes, the government said.
Sydney-based Kate Terry of Pinsent Masons, "The Australian government’s continued programme of investment in infrastructure and energy will provide a range of opportunities for a large number of contractors and suppliers in these sectors, including international participants. The Western Sydney Airport and Inland Rail projects are significant even on a global scale and will attract overseas players as well as the highly sophisticated domestic market."
For further information, please contact:
Ian Laing, Partner, Pinsent Masons
ian.laing@pinsentmasons.com
