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Fuel legislation lacking, warns expert

John Blackburn, former deputy chief of the Royal Australian air force and an expert on fuel security has weighed in on the current AdBlue situation, saying it’s no surprise the federal government is dragging its heels and may not even have the power to legislate change.

“The industry has been raising the issue since early November, but it doesn’t surprise me that the government took this long to react because that’s just how they work,” said Blackburn.

Despite the recent news of Incitec Pivot’s Gibson Island manufacturing plants intention to design, trial and scale-up manufacturing of significant quantities of technical grade granular urea (TGU), a critical component of AdBlue, Blackburn isn’t optimistic of turnaround times.

“How long is that going to take? If it takes 6 months, then we’ll still have a few months with some problems,” said Blackburn.

plant
Incitec Pivot’s Gibson Island manufacturing plant

Longtime trucking advocate, WA Senator Glenn Sterle was the chair of the first fuel transport security committee. Blackburn was at a session with Sterle in 2020 where he bought rail, trucking and maritime shipping industries together to discuss some of the logistics issues.

In the discussion, Blackburn cited a 2019 report by the environment and energy department into Australia’s liquid fuel security, which described Australia as effectively asleep at the wheel when it comes to fuel security.

“There was supposed to be a liquid fuel security review passed by a joint standing committee in 2018. The interim report came out in the middle of 2019, which highlighted there was no model for a fuel supply chain,” said Blackburn

“You have to wonder did they (the government) look at the fuel purely by itself, or how you get it to Australia, distribute it in Australia and what the implications are with all the components?”

Blackburn’s comments reveal that there has been no risk analysis into one of the most important industries in this country, the trucking industry. The demand growth for transport logistics is growing exponentially and even without the current AdBlue issues, was struggling to meet demand. Blackburn says it only serves to highlight the government’s lack of foresight.

“The trucking industry alone can’t meet that growth and demand. You don’t want to wait for something to go wrong like we have now. Our country is in a reactive mode. Supply chain problems may have manifested during the pandemic, but they’ve grown over time and just been ignored,” said Blackburn.

“We take the trucking industry for granted. People just assume they’re going to go to the supermarket or petrol system and products will be there.”

Another intriguing item from the interim report from 2019, is there hasn’t been a legislation review to allow national rationing of fuel since the 1970’s and as such, that legislation is no longer for purpose.

“So, at the moment we have an AdBlue problem, but I wonder if the government legislative ability to ration it? I doubt it,” said Blackburn.

With AdBlue currently being rationed by suppliers, there have also been reports of customer price-gauging, with little reports on what the Australian Competition and Consumer Commission (ACCC) is doing to combat it.

“I don’t think they have the legislative ability to do it, because they haven’t analysed the supply chain implications,” added Blackburn.

“When you look at the percentage of refined fuel we get from China, it does seem a bit farcical that we’re rushing to get as many nuclear submarines that we can in order to protect ourselves from a country that we continue to buy large amounts of fuel from.”

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