Queensland resources a long way to run
Speaking in Brisbane this week BIS Shrapnel analysts said they expected, as the investment boom does wind down - with some caveats - that increasing investment across other business sectors would fill the gap.
At the same time the powerful Australian Petroleum Production and Exploration Association revealed that the runaway Queensland coal seam gas industry was showing little signs of faltering despite speculation of an end to the good times.
APPEA CEO David Byers revealed that an extra 7000 people had been employed in the Queensland gas industry in the first half of this year, bringing the workforce to more than 18,500.
In comparison, employment in NSW's CSG industry only grew by 39 to 332 positions.
"The economic story developing between NSW and Queensland couldn't be more diametrically opposed. CSG to LNG projects worth almost $50 billion are progressing in Queensland, creating thousands of jobs and breathing new life into rural and regional communities," Mr Byers said.
BIS chief economist Frank Gelber told the group's annual economic forecasting conference in Brisbane yesterday that the investment boom - as opposed to the price boom - had two years to run in Australia and "three years in Queensland."
Committed projects, particularly the state's coal seam gas-to-liquefied natural gas projects, would ensure that.
Thereafter, he reckoned, there was a string of other resources projects, though by no means all that were on the drawing boards before the recent slide in commodity prices, that would still go ahead provided prices did not suffer a further collapse.
Dr Gelber said that while resource companies were complaining at the price pull-back - and high costs and a high Aussie dollar - they still had 42 per cent profit margins in the year to June, against 47 per cent at the height of the price boom. "Wouldn't you settle for that?" he asked.
Dr Gelber said he expected a "soft landing" as the rush of resource investment, which includes up to $60 billion in CSG-LNG investment in Queensland over the next four or five years, wound down.