Australia’s largest ASX-listed energy firm Woodside Energy has found itself at the center of a fiery senate inquiry, where executives defended the nation’s existing gas taxation framework amid intense scrutiny over the company’s decade-long $2.5 million in political donations to Australia’s three major parties: the Liberals, Nationals, and Labor.
The hearing, focused on reviewing gas resource taxation rules, was led by Greens committee chair Steph Hodgins-May, who pressed Woodside representatives hard over the nature of their political giving. Hodgins-May challenged the company to disclose what policy access the donations secured, questioning whether corporate funding should even buy entry into policy discussions. “As a Greens senator I could never ever imagine taking money in exchange for a meeting with a stakeholder,” she stated during the session. She further pressed for details on private communications between Woodside executives and Western Australian Premier Roger Cook ahead of Cook’s public stance opposing new gas taxes ahead of the upcoming federal budget, a question Woodside officials declined to answer immediately, saying they would respond to the query on notice.
The inquiry comes amid growing public and political pressure to implement a new 25% minimum tax on gas exports, a push Hodgins-May has publicly backed. She has pushed back against industry warnings that the time is not right for such a reform, arguing that energy giants have long delayed sharing their extraordinary windfall profits with the Australian public, the rightful owners of the nation’s natural resources. This momentum for higher gas taxes has built following a global energy price surge triggered by ongoing geopolitical conflicts in Ukraine and the Middle East, which has delivered Australian gas exporters a combined $149 billion in export profits since 2022. Over that same period, Australia’s national debt has swelled to nearly $1 trillion, with economic analysts projecting a 25% export tax would add roughly $17 billion in annual government revenue.
In his opening testimony before the committee, Woodside Chief Financial Officer Graham Tiver defended the company’s record and the current taxation structure. Tiver emphasized that Woodside already makes a massive contribution to Australian public finances and the national economy, noting that over the past four years, the company has paid roughly $13.8 billion in taxes, royalties, Petroleum Resource Rent Taxes, and other levies, equal to around 44% of revenue from its gas projects being returned to government. “Each year Woodside makes a very substantial contribution back to the Australian community through tax, royalties and other levies. When Woodside succeeds, Australian workers, community and shareholders share in that success, and governments receive the revenue needed to fund essential services such as hospitals, schools and roads,” Tiver said.
Tiver added that Australia’s existing tax framework strikes the right balance between generating public revenue and supporting the stable, competitive investment environment needed to maintain domestic energy security, create jobs, and keep local energy prices affordable. He noted that Woodside invests more than $10 billion in upfront capital for new projects, and that effective tax rates increase naturally over the lifecycle of gas developments as upfront costs are depreciated.
Market analysts have noted that the debate over windfall gas taxes brings legitimate arguments on both sides. Morningstar market strategist Lochlan Halloway explained that it is understandable for Australians to feel frustrated by the sudden surge in gas producer profits at a time of broader cost of living pressures. He acknowledged that as the collective owners of Australia’s natural resource endowment, the Australian public currently receives a smaller share of windfall profits than resource holders in comparable nations such as Norway or Qatar. However, Halloway warned that retroactively imposing a new windfall tax carries long-term economic risks. Unlike Norway, where the government is not just a tax collector but also an equity participant that shares upfront project costs and downside risks, a unilateral windfall tax in Australia would shift all asymmetric risk to private investors: the public would collect gains during price booms, but private capital would still bear all losses during price downturns. Halloway noted that the United Kingdom implemented a similar unbalanced windfall levy, and the policy has already led to a complete halt in new offshore North Sea oil and gas exploration, a situation not seen since 1964. Such an outcome in Australia would risk deterring future energy investment and undermining long-term energy security, he argued.