The resumption of partial gas supplies from the Varanus Island gas processing plant is a significant and welcome development, however the gas crisis which has hurt Western Australian business and industry is far from over.

CCI, after receiving advice from its members and energy suppliers, believes it is premature to declare the gas crisis over.

The State's peak business organisation, the Chamber of Commerce and Industry of Western Australia, believes the gas market will remain tight, and WA's energy network fragile, until the end of the year when full production resumes.

CCI welcomes the Government's decision to hold a review into the security of the State's gas supplies. However, it is essential that the terms of reference of this inquiry to be broadened to include all energy sources as part of the development of a comprehensive energy blueprint.

The review also provides an opportunity to examine the way in which the response to the crisis was managed, and the lessons learnt.

CCI calls on the Government to consult closely with the WA business community, which has borne the brunt of the gas crisis, to assist in the development of a responsible energy policy, and to ensure that the State is fully prepared to respond swiftly and effectively should energy supplies again be disrupted.

It is important for government, energy suppliers and the business community to take stock of the energy supply situation once the next tranche of gas is made available from Varanus Island in mid August. Decisions can then be made about what steps should be taken next, including the need for households and business to cut back on their energy use.

While it's pleasing progress is being made to resume full production at the Varanus Island gas processing plant and restore gas supplies to business and industry, there remains not enough gas for all users.

Considerable time, effort and money has been spent to reduce the effects on business and industry. However, WA's energy system remains fragile despite temporary measures including increased gas production by other suppliers, recommissioning of several coal fired power stations and increased use of costly alternative fuels such as diesel.

The gas crisis remains one of the most significant challenges facing WA business and the local economy in many years. CCI estimates the gas crisis has already cost business and industry $2.4 billion in lost turnover.

Statement by CCI Chief Executive James Pearson