Shadow Resources Minister Gary Gray is set to weigh into the debate around Royal Dutch Shell's proposed $US70 billion takeover bid for BG Group, insisting the deal would be "in Australia's interests", despite reservations voiced by the national competition regulator. 
Mr Gray will tell a conference in Sydney on Wednesday that the merger could create a new opportunity for the development of gas reserves held within Shell's Arrow Energy gas venture with PetroChina in Queensland.
He will voice support for the 2001 decision by then Treasurer Peter Costello to block Shell's proposed acquisition of Woodside Petroleum, but say that the Shell-BG deal would be good for Australia.
Mr Gray says that while the independent scrutiny of the deal by the Foreign Investment Review Board and the Australian Competition and Consumer Commission needed to "run its proper course", he believes the deal would have a positive impact on the east coast gas market.
"It could very well lead to beneficial development of Arrow controlled resources??? and potentially other yet to be developed gas reserves??? given the LNG export and gas field production infrastructure is now constructed and operational," Mr Gray will say, according to an advance copy of his speech.
The ACCC last week delayed a final decision on the Shell-BG takeover, releasing a "statement of issues" voicing concerns that the deal could lead to shortages for local gas buyers if gas is sent for conversion into LNG for export rather than sold into the market to the best offer.
ACCC chairman Rod Sims described the regulator's stance as an "amber light concern" and has requested more submissions from interested parties before making a final decision on the deal.
Mr Gray will contrast the Shell-BG deal with that of Shell's move on Woodside early last decade, which was deemed as not in the national interest by Mr Costello. Then, Woodside was the operator of Australia's only LNG venture, the North West Shelf venture, while today Australia has four producing LNG projects and more under construction.
He notes that the combined Shell-BG would produce more LNG than world giant Qatargas.
"It is possible that, through this takeover, not only is an opportunity created for the Arrow gas reserves but, importantly, a global player with substantial domestic assets is brought into our East Coast gas production and LNG export industry," Mr Gray will say. "This will enable the growth of a whole new business."
Mr Gray will also back up Labor's recent commitment that a Labor government would introduce a national interest test as part of the approval process for future LNG projects similar to what already happens in the US.
"A national interest test is a familiar measure," he will say. "It's a pity we did not have one ten years ago."
Mr Gray will also voice opposition for any move to limit scrutiny of the project approvals process under the Environment Protection and Biodiversity Conservation Act. He says there is no evidence of US-style litigation or "lawfare" in the EPBC approvals process and no "legal loophole" through which activists pass, as claimed by senior Coalition members including former Prime Minister Tony Abbott.