The Albanese government has lifted the baseline stock requirements of diesel in Australia to “protect consumers from major disruptions to supply”.
A media statement says the guaranteed minimum stock levels of traditional transport fuels will improve domestic fuel reserves to protect motorists, businesses and industries from future market turmoil and the ongoing global fossil fuel crisis triggered by Russia’s invasion of Ukraine.
The Minimum Stockholding Obligation (MSO) will require Australia’s two refineries in Geelong and Brisbane, and Australia’s major importers of refined fuels, to hold baseline stocks of:
- petrol – 24 days from July 1, 2023. Increasing to 27 days in 2024 for importers
- diesel fuel – 20 days from July 1, 2023. Increasing to 32 in 2024 for importers
- jet fuel – 24 days from July 1, 2023. Increasing to 27 days in 2024 for importers.
The obligation will also require refiners and importers to report stock levels fortnightly. The requirement will become weekly from July 1, 2024.
Minister Bowen said the obligation was a crucial measure to protect consumers.
“The Albanese government is delivering on the commitment to increase domestic fuel reserves, including petrol, diesel and jet fuel stocks, which the previous government announced, but did not deliver,” Minister Bowen said.
“We are providing greater energy security for Australian households and businesses impacted by global and domestic challenges to supply lines.
“Australia’s transition to electric and hydrogen-powered vehicles will also help guard against volatility in coming years.”
Viva Energy said in a statement that it welcomes the recent announcement made by Minister Bowen.
In response to the MSO, Viva Energy said it has already commenced construction of additional diesel storage facilities (90 million litres) at the company’s energy hub in Geelong to ensure that it is able to meet these additional stockholding requirements from 2024.
The company is also investing $300m to upgrade Geelong Refinery to meet new ultra-low sulphur fuel specifications and support the introduction of low emissions vehicles in Australia from 2025.
Geelong Refinery produces around 50 per cent of Victoria’s fuel, with up to a third of the crude oil sourced from local Australian oil and gas fields.
The refinery also produces a range of other products to support Australia’s unique requirements, such as bitumen for our roads, solvents for our mining industry and chemicals manufacturers, avgas which is used in planes to service our regional communities, and low aromatic fuels to help combat petrol sniffing.
Viva Energy’s CEO, Scott Wyatt said that the company is proud of its commitment to continue refining at Geelong and supporting Australian energy security.
“Geelong Refinery has faithfully serviced Australia since it began operations in 1954, and we are making significant investments to ensure that we continue to maintain fuel security while also supporting the transition to lower carbon and renewable energies,” Wyatt said.
“Our first green hydrogen production and refuelling facility is being built alongside our refinery and this will see hydrogen powered trucks and buses on Geelong’s roads from as early as 2024.”