Energy key to future, Costello warns -


TREASURER Peter Costello has indicated that ensuring energy supplies will be the main issue of this weekend's G20 summit, warning that shutting countries out of energy markets could threaten world security.
The agenda for the talks involving ministers and central bank governors from the world's 20 biggest economies shows they will devote twice as much time to energy security as to any other issue.
Mr Costello, who will chair the meeting, said he wanted to secure consensus on the principle of relying on free markets and transparent pricing to guarantee energy supplies, rather than see countries lock up supplies by buying ownership.
While he did not refer to any country, his comments appear aimed at China, which is buying into oil, gas and other energy producers from Australia to South-East Asia, Africa and Latin America.
China's national overseas oil company now owns 5.3 per cent of the gas from the North-West Shelf, and this year was reported to be considering a takeover bid for Woodside, the shelf's operator — a move that would require Mr Costello's approval.
China is also considering buying a stake in Australia's biggest uranium deposit, BHP-Billiton's Olympic Dam mine in South Australia.
"Where investment can actually increase supply, then investment will be welcomed," Mr Costello said.
"But if the supply is locked up, if countries feel they are being locked out of resource markets, that would be very destabilising."
Mr Costello said he wanted to see an "energy freeway" between Australia and east Asia, with Australian producers free to supply buyers from all Asian countries in the "massive industrialisation" they face.
The line-up at the summit — the most important economic meeting ever held in Australia — includes US Federal Reserve chairman Ben Bernanke, International Monetary Fund chief Rodrigo de Rato and World Bank president Paul Wolfowitz.
White House representative Robert Kimmitt said the security of global energy supplies would be an important part of the discussions.
When asked about attempts by some countries to corner energy sources, Mr Kimmitt said that "the question of energy and energy security has a strong priority attached to it already. That priority will only increase in the years ahead."
Mr Kimmitt welcomed the inclusion of climate change into the G20 talks, but refused to be drawn on a call by Mr Costello for a discussion of a global carbon trading