With eighteen years experience in energy retail and infrastructure businesses, Mark Harper, Chief Executive Officer of Agility, plans to continue promoting the pipeline industry, its interests and reputation to the government and the wider community during his tenure with APIA.

Mr Harper says fostering an environment to maintain a healthy, highly competent and growing industry hinges on having a strong input into the regulatory process, improving the effectiveness of research and development and encouraging new people into the industry.

“The pipeline industry is faced with major challenges. Maintaining a policy and regulatory environment that is conducive to continued pipeline development is important,” says Mr Harper. “Particularly as the pipeline environment becomes increasingly part of an Australian network and with the current level of change in pipeline ownership, it’s critical the industry is prepared to adapt to such changes.”

On the issue of pipeline maintenance, many existing pipelines still make up major connectors between gas fields and markets, many of which are over thirty years old. While these can be expected to be in service for at least another thirty years, Mr Harper says the way they are maintained going forward will be the defining factor in their performance and useful life.

“Effective and cost efficient asset management strategies and use of best available technology are key to increasing pipeline longevity.”

On the regulatory front, Mr Harper says that the current round of energy market reform by the Ministerial Council on Energy has proven to be a bigger challenge than was originally thought. According to Mr Harper, the MCE’s expectations of agreement on a new national energy access regime in 2005 was always an ambitious target; and it is now scheduled for introduction in January 2007. Of more concern to the industry is ensuring that the objective of a lighter-handed, more efficient regime remains paramount.

“Unfortunately the pressures to protect the short term interests of consumers have tended to push energy regulation down a more prescriptive and intrusive path,” says Mr Harper.

“This may put a dampener on investment in energy infrastructure, and especially pipelines. It is also a position of comfort for regulators who by their nature, are convinced that they are at least as able to determine commercial outcomes as the market.”

While there is an appropriate role for regulators, Mr Harper says it is important for the industry to demonstrate to Government and regulators that pipelines do not exercise the market power that regulators believe they do.

“We have to increase awareness that the current approach is self-fulfilling, that is, the more regulators interfere in a market process because they feel that it will not work, the more they ensure that it doesn’t,” says Mr Harper.

Clearly, regulatory issues are vitally important to the overall wellbeing of the industry and Mr Harper is conscious of balancing this focus with the concerns that face the larger number of active suppliers who are also APIA members. Mr Harper says it is essential that APIA services all major pipeline specific interests of the member companies and that it must maintain awareness of these interests and respond with strategies and programs that are appropriate.

“The main issue, which affects all members of the industry, is whether policy encourages or discourages the development of new pipelines and the success of existing ones,” says Mr Harper. “It is therefore essential for all APIA members that the policy environment, which is chiefly economic regulation and to a lesser extent, technical regulation, fosters the economic success of pipelines.”

Regulators aside, another key challenge facing the pipeline industry is the lack of ‘new blood’ in the industry. Faced with skill-shortages across the country, Mr Harper agrees that training and skill retention within the industry are important.

“At the end of the day, retaining skills in the industry is an issue for industry participants. After all, hiring the right kind of people is essential to their success. However, organisations sometimes ‘assume’ that they will solve the resources issues by simply going to the market,” says Mr Harper.

According to Mr Harper, it is important that APIA understands the market conditions for skills and communicates this to its membership. Mr Harper says this confirmation of the big picture will let industry participants develop strategies to respond appropriately.

“APIA can contribute directly by initiatives such as the upcoming Young People’s Forum in Canberra which is designed to give greater opportunity for knowledge exchange, networking and input into the industry,” says Mr Harper. “This proposal is receiving tremendous support and will no doubt encourage young people to consider a long and rewarding career in the pipeline industry.”

Historically, APIA has assisted with research and development by facilitating a selection of research topics and overseeing the use of members’ funds in carrying out this research. Mr Harper says that he and the Board will be looking at ways APIA can further improve its effectiveness in this role.

In an industry that has undergone massive change over the past five years, Mr Harper is confident APIA will play an important role in the pipeline industry’s future.

“The current level of change in the energy industry is certain to continue over the next few years too. It is important that APIA continues to play a relevant role during these changes to ensure the industry remains vital and prosperous, meets its challenges and makes the most of the many opportunities coming our way,” says Mr Harper.