The community concerns revolve around the need for information, confidence and transparency in all dealings. A failure to "take the communities with you", runs the risk of a loss of political support and the imposition of more regulations. Already, the CSG/LNG onshore projects need some 1500 headline approvals from Federal/State/Local governments and possibly as many as 3000 approvals overall required before they can proceed. This level of scrutiny is greater than that required by the Uranium industry!

In particular, the communities are looking to be satisfied with
i. Environmental management. They need to be assured that there is transparency and accountability over time with industry practices.
ii. Local content to generate local employment. Local suppliers need to have a "piece of the pie" but there are quality, cost and capability issues that industry needs to communicate effectively; it is a key issue to maintain Government support.
iii. Safety issues. The lessons from Montara and GOM spills are still to be enacted. There is a focus on the safety processes to develop a core culture that will ensure that all incidents/lessons from accidents are communicated within companies and that senior executives know and will be held accountable for material breaches in safety and poor risk management.
iv. Work skills and Training- There is Federal Government recognition of a shortage of skilled workers to meet the resource development requirements during the next 5 years. Government needs to manage this issue to avoid inflationary impacts of wages breakout through a mixture of policies involving more training, temporary 457 visas for skilled workers, Enterprise Migration Agreements and work force planning. The industry will need to continually demonstrate its commitments to employee productivity.
v. Supply and pricing of resources for local consumption. In WA, the community is concerned about the availability and the gas price for domestic consumption with gas prices there about double those in the prevailing Eastern Seaboard markets. WA will maintain with flexibility the domestic restriction allocation of project resources to the local market. It is essential that the community sees that affordably priced gas is available to that market as a precursor for continued support of the LNG developments with their market based contracts.
vi. Willingness of the industry to address community issues (listen, educate and act) and develop a sense of participation in the process. The industry must be prepared to negotiate and deal with community issues.

3. LNG:
Follow-on from 2010 As per the 2010 Conference, the importance to the Australia economy - the dominance of LNG to Australia was re-enforced.
To 2025, LNG demand is expected to grow globally to 460 MTPA, but will be influenced by the changing gas markets of the Americas as unconventional gas such coal shale gas (CSG & shale gas) wins market share at competitive prices. The WA developments of Pluto are surging to first production in 2011, 2 new projects in Queensland have achieved FID with a third expected in 2011. First shipment has slipped to 2015/2016 time frame but still a massive achievement for the industry to move from concept to market commercialisation to FID within 5 to 6 years and then to construct and within a further 4 years.
In addition to the existing LNG projects at NW Shelf, Darwin and at Gorgon ( 2014 production) and further LNG developments at Chevron's Wheatstone and Shell's FLNG at the Prelude which are likely to get FID in 2011 and first production in the2016/2017 time frame , Australia will propel itself into 2nd place internationally as an LNG supplier globally. This will be more evident as the traditional global producers such as Nigeria, Russia Malaysia, Indonesia and Iran will have reduced capacity.
There were differing views as to the global supply/demand equation for LNG over the next 5 years especially for the Asian markets as developments mature and demand changes. The views include a tightening supply position in Asia as both India and China will account collectively for about 50% of uncontracted demand to 2020, while a contrary view is that there will be limited opportunities for "new players" as the uncontracted demand in the next decade in Asia will be re-supplied from existing fields. This latter view depends on the supply availability and surety from existing LNG producers.

In the short term this will be especially important as Japan adjusts its fuel mix by about 6% - 13% of their energy needs post the Fukushima nuclear mishap. In the short term, this change will require about 6 MTPA of LNG to meet energy needs to be supplied initially from LNG destined for the Atlantic Basin market. The longer term demands are still being assessed.
For Australian sourced LNG that probably means a benefit of upward price pressure to their contracts. In addition, Australia has a reputation for supply security, stability and reliability which translates into demand for Australian sourced LNG. However, there are near-term risks that the proposed MRRT/extension of the PRRT that will add costs pressures to the projects that Australia's competitors are unlikely to have. Therefore, it will add to the commercial uncertainty of some projects.
Price negotiations will be very competitive, especially those contracts that have oil indexation as a price driver. In the longer term, it is estimated that a FOB gas price of $12/MMBTU (at least $US 80/BBL) is required to have a sustainable project at current costs and regulations. Project viability is very sensitive to market delays, cost overruns and worker productivity. Industry estimates on other LNG projects, have shown that a combination of a years delay in production coupled with a 20% cost overrun can reduce project economics by up to 80%. These parameters are within the range of potential outcomes for Australian projects!
These massive resource projects demand solid partnerships between all participants- Governments at all levels, resource owners and developers, banks, regulators, customers and community.
4. Global Supply and Demand. The issue of China/India liquids demand growth to 2030, as they raise their respective living standards and hence the impact on the global supply/demand equation for petroluem products raises serious questions about supply. The conference heard that through energy efficiency with both the EU and the USA changing their respective energy consumption mixes and with China's drive into gas ( environmental reason the driver), the global supply will be able to cater for increased liquids demand and usage in China and India and not necessarily at the expense of industrialised countries.
By 2030 it is estimated global demand for petroleum will be 102 million bopd - up from 85 million bopd in 2010 - of which 75% of the growth will come from Asia and the balance from non- OECD counties where oil dependency will remain very high.
To 2030, OECD countries will reduce their demand by 4 million bopd due to changes in their fuel mix equivalent to 1990 usage levels. This reduction will come from higher gas usage (LNG) and lower oil usage driven by technology and efficiencies. A similar story emerges for USA where the main source of gas will be non-conventional (coal shale and csg). Power generation will be the main use for gas and that will assist in emissions control. Electric cars will have limited impact on demand patterns until post 2030.
75% of the oil supply will come from OPEC which will entrench the organisation's market power on pricing and supply. Interestingly, by 2030, biofuels will max out at 6% of the fuel mix with 6 million bopd due to land access issues.
This analysis starts to put a "fence" around the issues of energy convergence (energy per capita of GDP) as countries industrialise and as the pattern for USA, Japan and UK (market economies) follow the same efficiencies trends. Also with China's move to industrialisation (central economy) following the same OECD patterns, it indicates how we should start to think about the sharing of scarce resources as the population grows to 2050.
5. Balance of Payments implications - Liquids deficit. In 2010 Minister Ferguson's presentation at APPEA provided a stark reality check on the dramatic impact on the nation's balance of payments outlook of rapidly declining domestic oil production. Again in 2011, the APPEA Chairman reiterated this looming critical issue.
The Palliser Report from previous APPEA Conferences has highlighted this impact as critical to future standards of living with significant risks to the Australian dollar as the currency adjusts to increasing energy imports and the general demand for overseas goods and services. The Government's own figures forecast that the deficit, from increased purchases of imported petroleum will increase from A$16 billion in 2010 to A$30 billion in 2015 at current prices. Tightening oil supply over this period due to increased Chinese and Indian demand will likely increase prices and hence the deficit. Payment has to come from somewhere - increased exports of LNG would be critical.
This issue is "a ticking time bomb" for the Federal Government which has few policy levers to use to ameloirate the inevitable rise in bowser petrol prices. The community deserves to have some serious policy debates about the options not just "knee-jerk" political comments when the community feels the economic pain at the petrol pump!
Geoffrey R Widmer
CEO
Palliser Group
PO Box, 544 Hawthorn Vic, 3122.
61-(0) 419-310-601
Email: gwidmer@palliser.com.au
www.palliser.com.au
20th April 2011
Disclaimer:
The preceding commentary is a compilation of views and data expressed at the 10th April to 14th April 2011 APPEA Conference expressed by the various participants. The Palliser Group has not verified these facts as presented to the conference and has not made independent enquiries as to the validity of the statements made or of the data presented. The Palliser Group recognises the authors of the various views as detailed in the APPEA Conference Program.

Disclaimer:
The preceding commentary is a complication of views and data expressed at the 22nd to 25th June 2010 WPC regional Conference expressed by the various participants. The Palliser Group has not verified these facts as presented to the conference and has not made independent enquiries as to the validity of the statements made or of the data presented. The Palliser Group recognises the authors of the various views as detailed in the WPC Conference Program.

Palliser Report- Good Oil Conference September 2007 15th September 2007

The annual Good Oil Conference in Fremantle continues to grow in importance as a venue for providing a window on the industry for small to mid cap companies and what is driving their exploitation successes and profitability. The importance of the 2-day "beauty-parade" event is demonstrated by the significant industry participation (about 50% investors and 50% companies) with 45 companies detailing their strategies and financial position, economic forecasts and contribution to the hydrocarbon industry. However, with a few exceptions, the calibre of presentations was poor this year compared to previous years.

2. Pricing and Industry Optimism. There was an acceptance that
a. Oil prices will remain at or near US$70/bbl in the foreseeable future given the continued deterioration of the global supply / demand imbalance for liquids production; this being aggravated by increasing global liquids demand underpinned by rising living standards in Asia, particularly in China.
b. The forward price curve for 12-month NYMEX crude contracts shows prices to remain in excess of US$75/bbl. This 12-month forward curve price has been increasing over the last 4 years in response to substantial changes in petroleum demand, particularly in Asia, and is not indicating a price plateau or "bubble burst" in the oil price. This pricing signal is a key determinant in using cashflow to generate new and alternate exploitation options.

3. Global markets. The macro demand issues driving the market are -
a. Global GDP growth will be 5.25% p.a. and 4.75% p.a. in 2007 & 2008 respectively with a split 75% for underdeveloped countries and 25% from developed countries.
b. Global demand for oil and gas to 2030 is estimated to grow at 3.6% p.a. and 4.35% p.a. respectively; for liquids, demand rising from over 80 MMBOPD now to 140 MMBOPD in 2030. Of these growth factors, 1/3 of the global increase in oil demand is from China. China is "in transition" with strong GDP growth over the last 5 years greater than 10% p.a. This high level of GDP growth is forecast to continue for a least the next 2 to 3 years, which will underpin a burgeoning domestic economy with discretionary expenditure estimated to grow from circa $US 2,000 to US$ 5,000 per capita by 2016.
Empirical correlations in other country economies with past rising discretionary incomes show this rising standard of living will lead to higher automotive growth and petroleum demand (as forecasted above from 80 MMBOPD to 140 MMBOPD by 2030) with 60% of the demand related to transport - primarily automotive use. Car sales are forecast to reach 1660 million in 2030 from 939 million in 2010. China's market share of the increase will be from 11% to 23% of total cars global sales (380 million) over this period. In the absence of major and sustained exploration success, these facts point to continued upwards pressure on the oil price.
c. In the absence of major and sustained exploration success, these facts point to continued pressure on liquids pricing as the market adjusts to the forecast demand scenarios as noted in point 2.
d. The Australian exchange rate is expected to be valued at around AUS$0.85: US$ for 2008. This appreciation in the exchange rate will ameliorate the rises in crude prices to the Australian consumer and a level of AUD$0.75: US$ would push the bowser price over $1.50 to 1.60 per litre!
(Data source: Westpac and Paterson Securities)

4. CSG provides the excitement to the gas market!
The market can best be summarized as follows:-
a. In Queensland, companies have contracted large acreage positions with significant hydrocarbon potential. Increased certified 2P reserves are being achieved for commitments to sales contracts for retail and power generation. Assets are being commercialised. The industry is addressing technology issues, such as non- potable water production, that improves profitability of operations. 60% of QLD gas production is CSG and its market share will likely increase with increased reserve certification.
b. There are extensive exploration and work programmes addressing stratospheric claims of potential reserves of about 6 to 10TCF as companies are committing substantial budgets and resources to "prove-up" and commercialise this important resource.
c. The industry is being innovative in seeking "value-add" processes to generate trading margin as there will be limited opportunity for substantial price improvement because there is no external pricing source to the Queensland gas market given the potential reserve supply. Improved pricing will come from processing "value adds" – LNG, power generation, CTL etc. This will also diversify pricing risks based on well head values only. Generation of carbon credits will enhance project economics.
d. There are 2 LNG projects planned for Gladstone based on CSG, subject to reserve commercialisation, by Arrow Energy NL and Santos Limited. Both are intending to service the export markets of Asia from 2010 to 2015. These are new and critical developments for the commercialisation of CSG.
e. There are tentative plans to increase the pipeline infrastructure that will enhance CSG projects and the commercialisation to markets serving the Gladstone area and mid-NSW. If the CSG fields are developed, "pipeline geology" will ensure additional reserves.

5. Cooper Basin consolidation- The time is rapidly approaching when there will be significant consolidation of Cooper Basin producers- rationalization of the administrations of companies chasing fewer sizable deals. The companies operating in the Cooper Basin generally have low reserve indexes (less than 3 years), but high short term cashflow which needs to be re-invested in reserve replacement exploitation that will not come from the Cooper Basin. Hence, companies are now changing strategies to use the high short-term cashflow (mainly derived from price) to obtain exploration positions overseas in "unexplored basins" as they strategically position themselves in Asia, Africa and Middle East hoping to build sizable reserves & production.
Shareholders with few exceptions are not rewarded through dividend flows and so value will only be derived from market plays on the stock market or from consolidation. This will be a different risk position for investors and their collective reaction to these new exploration areas will be interesting to monitor!

6. LNG options for PNG are gathering pace with a possible ExxonMobil-led consortium continuing commercialisation studies for a plant complex to be located on the Papua Gulf leveraging off the existing oil export infrastructure, at an estimated cost of US$ 9 to 10 billion with production targeted for 2012- 2014 at a rate of 6- 7 MTPA. This is underpinned by substantial reserve certification and high liquids content to justify the economics of the project. The commercial viability is being evaluated against a strong demand for LNG - with recent contracts priced at US$ 8.00/GJ (US$60/BBBL) - and Asian market opportunities post 2010. All signs point to FEED decision by year end 2007 and regulatory approvals are well advanced.
It adds a strong dimension to PNG gas exploitation and there is increased interest and activity in exploration of new permits and tentative plans for the development of "stranded assets", but based on the ExxonMobil consortium decision.

7. Company valuations Industry data suggested that valuations have risen significantly based on the strength of the oil price.
a. Purchase price for hydrocarbon reserves has increased 30% since 2004 to US $ 9.70/BOE
b. ASX listed resource companies are likely to have P/E ratios on earnings of June 08- X14.7 and X13.5 for June 09 against a long term average of X18.6 (Patersons)
These parameters indicate likely softening in values for the oil and gas sector.

8. Companies that are positioned in the growth areas
Over the last 5 years it is interesting to see how the industry has been transformed from an exploration focus with limited cashflow to a position where companies with significant cashflow and reserves can sustain aggressive exploitation programs to build shareholder wealth. For example:
(1) AWE with long-life reserves and burgeoning cashflow with Tui field commencing production;
(2) ROC with a strong reserve position and production of 10,000 bopd in
2007 plus strong cashflow and Angola and China exploration upside;
(3) Nexus Energy NL with projects, financial resources and cashflow generated from 40,000 boepd from 2012;
(4) Arrow Energy with its substantial CSG resources to evaluate the
feasibility of LNG to Asia markets around 2015;
(5) Horizon Oil NL with net production at 6000 bopd by 2010- proven
reserves underpin share price, but substantial exploration upside in
Offshore China, Thailand and PNG;
(6) First Australian Resources Ltd (FAR) with exploration exposure in
Senegal- 7 leads with potential 1 billion barrels with about 50% working
interest.
Geoffrey Widmer CEO Palliser Group: 03-9819-3995(p), 0419-310-601(m)
Disclaimer
The above observations are not recommendations to acquire shares in any of the companies. Individuals should seek independent advice based on their own circumstances and risk profile when investing in any of these shares. Information about these companies was in part derived from presentations from the RIU Conference which contained forecasts and assumptions about pricing, production, costs foreign exchange rates and risks which have not been derived or verified by Palliser Strategic Management Pty Ltd A(Palliser@). Palliser takes no responsibility for the derivation of these numbers.

The article by Leo D'Angelo Fisher on The madness of meetings canvasses these issues and Palliser was invited to provide its views on meeting Leadership and the importance Board meeting practice to set the meeting culture of the business.

MOST EMPLOYEES HAVE attended them and wondered why. Most have endured them, thinking about more pressing tasks left unattended. They are, of course, meetings – a seemingly permanent feature of modern corporate life – and more often than not they don't need to happen.
Meetings probably have more to do with entrenched habits and cultures than a reasonable expectation of achieving a useful outcome, organisational psychologist and principal of Brisbane corporate performance consultant NovumAVI, Dr Robert Lake, says.
Some managers are "meeting happy" and often oblivious to the capacity of meetings to waste time and eat into productivity, while others genuinely try to make meetings more effective. "A more useful consideration might be: do we need to have this meeting?" Lake says.
Given the prevailing meetings culture, he believes meetings have become a sanctuary for "people who don't have enough work to do".
"I have sat in meetings where memberships have grown like Topsy," he says. "There will be a number of people listening at these meetings, but not really contributing. It might be a way for these people to be involved, or it might be a way of wasting time, but either way I think it does become a cultural thing. There are useful meetings, and at the other end of the continuum there are useless meetings. What happens in between that diminishes the value of a meeting?"
Inevitably, the problem is that too many meetings are being held, which exacerbates the perception that meetings don't achieve anything. Many of these meetings take place, Lake suspects, because there remains status associated with the meeting – or more to the point, calling meetings. "That's what I'd call the status meeting, where you have someone saying, 'I'm calling a meeting because I can; I am an important person.' But if that person is not focused on outputs, the meeting will wander. A meeting has got to be linked to outcomes."
Lake says another factor that has contributed to ineffective meetings has been a tendency in some organisations to democratise meetings: companies are still wedded to holding meetings, but they seek to make them less formal. Meetings are led by managers who are either deliberately informal, or lack the skills to chair a meeting. Either way, the result can be that the person heading the meeting is not in control.
"One of the side effects of flattened organisational structures and more democratic ways is that people have a reluctance to lead. There is a cultural groundswell of dealing with things through consultation and collaboration in organisations, which ends up meaning no one's in charge.

“The best meetings occur when there is a firm structure. More formal is better than less formal. Chairing a meeting is a leadership role."
Geoff Widmer, chief executive of Melbourne consultant Palliser Strategic Management, agrees. "Leadership of meetings is crucial. Some of the disciplines [of running a meeting] have gone out of the meeting structure because people don't want to appear bureaucratic," says Widmer, who is also a professional company secretary specialising in small company boards.
The most common reason for ineffective meetings, he says, is the lack of direction from the chair. He recommends that companies look to boards for best practice. "Good boards are well structured, they have agendas, minutes are taken, and action items are recorded and summarised at the end of the meeting. Middle managers who have the opportunity to do so would do well to follow what happens at that level. At the end of the meeting, the chairman should summarise the action points, who's going to follow through on those action points, and the date by which they must do so."

A meeting also needs to be "targeted and focused". Attendance should be strictly limited to people who are involved in the decisions being made. One way of ensuring that meeting skills are passed on within an organisation is to ensure that executives with operational responsibilities have the opportunity to make presentations at board meetings. They in turn take the discipline and structure of these meetings to their own staff meetings.
"Boards should represent best practice. They set the meetings culture of the business, which is why I encourage boards to include relevant executives to present on their specialty areas," Widmer says.

The managing director of Melbourne information technology services company ExpressApps, Dr Mark Harrigan, says it is important that companies are prepared to not have meetings. While the company does have regularly scheduled meetings, the meetings don't go ahead unless there is an agenda.
"We do not have a written policy but we do have a practice that says formal regular meetings should be kept to a minimum. Scheduled meetings don't go ahead if there's nothing to discuss. Basically, nobody is allowed to have a scheduled meeting without a purpose. It's good to have meetings in the calendar, but people need to have the discipline to say 'let's not meet' even if they've got a meeting scheduled."
ExpressApps has three regularly scheduled meetings: a monthly "all-company" meeting (the business employs 25 people) and fortnightly meetings for the sales and engineering teams.
The monthly meetings take place as scheduled – even without Harrigan – because it is an opportunity for staff to get together to discuss business and personal issues affecting them.
"The sole purpose of the company meetings is to have a get-together," Harrigan says. "It's an opportunity to catch up. Everyone needs to know where everyone fits in the organisation, so that kind of gathering is important."

Some practical tips for meetings!

Get down to business
• Schedule the meeting off the hour (for example, 10.10) and declare its length beforehand. This encourages punctuality and erodes the "a meeting lasts for an hour" mentality. There is no reason, other than habit, why a meeting should start at 10.00 rather than 10.05.
• At the meeting starting time, create the expectation of discussion times and decisions to be taken, start talking about the first agenda item – don't stop for latecomers, don't backtrack for them, and don't acknowledge their lateness. After one or two of these meetings they will learn to turn up on time.
• As the meeting closes, summarise the key points discussed and resolutions made. It is critical to allocate action items, who is responsible and agree the time for resolution of outstanding matters. Remember after the meeting follow-up as accountability is critical for improving meeting culture!
• At the end of the meeting, declare it closed and stand up – this signals both that the meeting has finished and that it is time to leave.

Source of Tips: BRW Leadership article including NovumAVI and Palliser Strategic Management Pty Ltd.

In time competitors can leverage customers away, as without customer focus, these barriers usually only provide temporary market dominance as a combination of rapidly changing technology, advanced communications systems and shifting consumer demands, substantially reduce the product life cycles of existing products and provide new real alternatives that compete with your market dominance albeit at a better value proposition. By trying to constantly “shore-up” the barriers to entry, one of the real targets of a company’s activities- namely enhancing existing customer satisfaction, is ignored at the peril of the company.

Barriers to Exit create a focus on the customer and make it very difficult decision to change once you are established within their business. To ensure that you reach that position a company must
1. Provide a high grade quality offering after the initial contract is won!
2. Over deliver and under promise on services and contract requirements- actions and support are paramount!
3. Keep the customer at the technical edge of your offering by providing upgrades regularly at competitive pricing.
4. If problems occur – fix them and leave the blame game to others! Respect the customer's time.
5. Partner, if needed, with them by sharing risks for new products and systems within your core competencies.
6. Develop professional and ethical relationships at multiple points in the organisation so you can act if issues arise. Be frank and open about issues with fact based reasons for relationship problems and tackle them directly.
7. Understand their culture; management and business model- develop a "play-book" on key customers.
In short, develop an inter-dependency with them that makes the Barriers to Exit to insurmountable. Wrap "management- blanket" around them a give the customer a corporate cuddle so they know you care and support their business.

Barriers to Exit are the real drivers of sustainable business and value creation as they underpin your performance.

Former President Jose Maria Aznar of Spain has experienced international terrorism personally. Although he has left office, he continues to actively promote and to bring into sharp focus those political and economic issues and policies in Europe that, if left unaltered, are likely to have negative global implications for all Western Democracies and cultures. Such is the leadership path that Aznar has demonstrated by continuing to engage the global leaders with his views.

I had the opportunity to hear the former President on Monday 19th March 07 deliver a blunt and passionate message on Spanish relationships with Europe, the issues confronting Europe for its long term survival, the importance to Europe of the USA Atlantic alliance and the impact terrorism on all of the western world. As he said "I am in my second world (life) after surviving a terrorist attack in April 1995". Aznar is eminently qualified as an experienced European Leader to provide stimulating and thought provoking commentary on global issues as they impact on Europe and us all.

When President, Aznar was leader of the conservative Partido Popular (PP) and was in power for eight years from 1996 to 2004. He led Spain through a dramatic period of substantial economic growth via business renaissance and the support of the European Community. He also headed significant political change to confront ETA terrorism and develop alternative international political alliances, notably with the USA and the Middle East.

Spanish influence, both politically and internationally, grew under his watch.

Aznar went further and said that Europe has lost power and influence over the last 20 years. During that time Europe has grown faster than the USA, but structural problems have contributed to its decline. In particular Europe has:
1. collectively failed to liberalise its economies,
2. allowed mistrust to fester on key policy areas of foreign relations,
3. not defended the importance of the market economy by allowing a "flood of protection", and
4. allowed the increase of anti- USA sentiment to influence decisions and activities.

In providing a direction, he states that Europe should develop the posture of an Atlantic Europe by working more closely with the USA and not try to be a counter weight to it. Through this process, Europe would become part of an integrated market which would promote greater trade liberialistion and enhance the values of the European democracies. This alliance would lead to a greater global influence for the European Union ("EU"). As an example of this closer Atlantic alliance, Aznar believes that the role of NATO should be re-directed at fighting global terrorism; Australia as a beneficiary of this policy should be a member of NATO.

He spoke with great confidence about the achievements under his presidency in Spain, pointing out that as a result of his government's economic, social and public expenditure reforms, the Spanish GDP grew by 64% during his time in office. He notes that prior to his presidency (1975-1996) there was a zero net jobs growth. However, over the eight years following his election, five million jobs were created, the economy grew at an average of 3.4% p.a., budgets were balanced, public debt fell from 7% GDP to almost 0% and the average Spanish income increased from 78% to 87% of the average income of the EU. Finally to-day, Spain is the 8th G8 global economy and is the 6th net capital exporter.

In response to my question about how Europe could achieve energy independence, Aznar said that there is an indispensable need to eliminate energy dependency and to diversify away from traditional gas supplies from Russia and North Africa and oil from the Middle East. This could be done by adopting additional supply options for nuclear and renewable energy. He added that this is best response for addressing global climate change issues where the EU should take a leading role.

The former president speaks with a direct and forthright manner. He embraces lateral thoughts to stimulate thinking about ways to combat terrorism both in Spain and globally.
Whilst he did not mention this directly, he greatly changed the Spanish foreign policy by re-directing Spain's focus to North America away from reliance on France and Germany. He looked to moderate Arab States and to South America for engagement on his political thoughts. He makes no apologies for Spain's involvement in Iraq and Afghanistan as he sees these as important planks in fighting global terrorism.

His PP Government's economic and political record gives him the credentials to continue to lead the wider political debate and to speak passionately about the future of his Spain and Europe. Aznar is one of the great modern European leaders whose views should be considered and debated widely. Melbourne was privileged to have President Aznar here and to have the opportunity to listen to his thought provoking global views.