Santos' A$16 billion (US$15.89 billion) gas project in Queensland will face a challenging time securing labor as the state rebuilds from the floods, federal Resources Minister Martin Ferguson says.
The Gladstone Liquid Natural Gas (GLNG) partners have approved the development of the $16.11 billion GLNG project in Queensland.
Santos Ltd says major works will now start on upstream field development, a 420km pipeline and LNG plant facilities.
GLNG is a joint venture between Santos, which owns 30 percent, and three of the world's largest LNG companies, PETRONAS, Total and KOGAS (KSE:036460).
Mr Ferguson on Thursday told reporters in Canberra the project could create 1,500 jobs in the first half of this year and 5,000 jobs during construction, with 1,000 permanent production roles.
He said the project would make Australia the world's second-biggest LNG exporter by 2015.
But he admitted there would be competing demands for workers as Queensland rebuilt from the flooding.
"They are going to be matters that are going to have to be discussed in detail at a government level once we get through the immediate challenges on the flood front," Mr Ferguson said.
"We already have a challenge at the moment in terms of the shortage of labor in Australia and the potential impact on wages - we are aware of those matters and I suppose the difficulties in Queensland at the moment add to those challenges."
Mr Ferguson said he did not support a boost in the migration program to address the skilled labor shortage.
"I think we've got a pretty good migration program at the moment," he said.
"I'm not proposing and no-one is proposing at the moment a huge increase in migration to actually work out how we attend to the immediate challenge of reconstruction (in Queensland) and projects such as Santos, but they are issues that government considers from time to time."
Meanwhile, Mr Ferguson said he expected to have a final draft of new resources tax legislation prepared by the second half of 2011 after further public consultation and talks with Treasury.
He said he expected outstanding issues with the states over royalties would be resolved "in due course".
(C) 2011 Asia Pulse Pte Ltd.