The Department of Resources, Energy and Tourism’s 329-page Draft Energy White Paper 2011: Strengthening the Foundations for Australia’s Energy Future is a comprehensive look at “Australia’s future energy needs to 2030” that provides “a policy framework to guide the further development of Australia’s energy sector.” To this end “it identifies four priority areas for future action and outlines a set of initiatives to progress this agenda.”

The draft is now the subject of a period of public consultation through mid-March 2012. The Australian government intends to release the final version around the middle of next year.

You can boil it down to two words, though, that tie the whole tapestry together: natural gas. Natural gas will be a major contributor to Australia’s future energy policy and a key contributor to power generation Down Under–indeed, all over the world–as efforts to reduce carbon emissions get serious. Coal-fired plants now provide about 75 percent of Australia’s electricity, which is one of the factors that make it the highest per-capita emissions country in the world. But this share will diminish in response to the new carbon tax, among other efforts to curb greenhouse gas emissions.

In Australia AUD10 billion a year has been spent since 2007 on electricity generation capacity, most of it to update and/or replace existing infrastructure and capacity rather than build new capacity. Since 1998 only AUD12 billion has been spent on new electricity generation, but AUD80 billion will be required over the next couple decades.

Overall Australia requires about AUD240 billion of investment in its gas and electricity industries alone over the next 20 years to ensure the country has reliable power supply. That’s on top of the billions already committed to liquefied natural gas (LNG) projects.

Plenty of gas both onshore and offshore–and a massive pipeline of developments underway–most of that gas is planned for export as LNG. Australia, in fact, is home to almost half of the projects in some stage of development around the world. Green-lighted projects worth USD150 billion would generate about 60 million tons of clean-burning gas over the next decade and push Australia past current No. 1 Qatar and make it the top LNG producer in the world.

Over the next several decades, even assuming a rapid and substantial increase in renewable energy sources, natural gas will be needed during the transition from coal-fired power generation and later as the back-up fuel for renewable energy when the sun isn’t shining and/or the wind isn’t blowing. The white paper concludes that that natural gas will grow to account for about 44 percent of power generation over this period.

With this many projects focused on Asian LNG demand in the works, from an investor’s perspective overbuilding is a distinct risk. All of these projects occurring over roughly the same time frame and in two regions of Australia has also led to substantial wage and cost inflation. LNG projects also have longer construction-time cycles than typical E&P projects, typically four to five years. Contingencies’ included to deal with the “known unknowns” are typically too low, and impacts of cost inflation are regularly underestimated.

Overruns for seven major projects completed since 2005, including the first phase of the Pluto project in the Carnarvon Basin northwest of Karratha in the state of Western Australia, have averaged 35 percent, enough to overwhelm rates of return on Australian LNG projects that average in the low- to mid-single-digits. E&P companies with strong balance sheets that lock in production ahead of time under long-term contracts with reliable customers are able to deal with these types of variables.

Another way to build wealth in the Australian LNG boom is to focus on companies that provide services under contract to project operators such as Australia-based midsized E&Ps Woodside Petroleum Ltd (ASX: WPL, OTC: WOPEF) and Santos Ltd (ASX: STO, OTC: STOSF) as well as Japan-based Inpex Corp (Tokyo: 1605, OTC: IPXHY) and Super Oil Chevron (NYSE: CVX).

WorleyParsons Ltd (ASX: WOR, OTC: WYGPF, ADR: WYGPY) provides professional services to the resources and energy sectors and the complex process industries operates in four primary business segments: Hydrocarbons, Power, Minerals & Metals, and Infrastructure & Environment. The company conducted early-stage analyses of Chevron’s 8.9 million metric ton per year, two-train Wheatstone project in Western Australia’s Pilbara region and recently won a AUD235 million contract to provide construction management services for the entire endeavor.

Worley recovered from a weak first half to post full-year fiscal 2011 profit growth of 25 percent, from AUD291.1 million to AUD364.2 million. Revenue grew 12 percent from AUD5.1 billion to AUD5.68 billion. Operating cash flow increased 5 percent to AUD294 million. Earnings per share were AUD1.215, while the company declared dividends of AUD0.86 per share, for a full-year payout ratio of 70.8 percent.

Canada-based ShawCor Ltd (TSX: SCL/A, OTC: SAWLF), through its Bredero Shaw unit, is the world’s largest applicator of pipeline coatings for the oil and gas industry for both onshore and offshore pipelines. BrederoShaw recently won two contracts at Wheatstone and executed a “letter of intent” for work at another, Ichthys, that combined could generate USD570 million of revenue.

In November 2011 ShawCor signed deals with Chevron worth USD170 million to provide pipeline coatings and related products and services for the flowlines and to supply coatings on the gas supply trunkline for the Wheatstone. The USD400 million Ichthys arrangement to provide coatings, executed with Mitsui & Co acting on behalf of 76 percent owner Inpex and partner Total SA (France: TOT, NYSE: TOT), is contingent on a final investment decision that’s due by year’s end. The company also won a USD45 million pipecoating contract for the Barzan project in Qatar.

The yield on ShawCor’s stock is modest at about 1.3 percent as of this writing. But the dividend rate, currently CAD0.08 per share per quarter, has grown 6.8 percent over the past year, 7.6 percent over the past three years and 18.5 percent since 2006. The company has very little debt and about CAD60 million in cash on hand.

Origin Energy Ltd (ASX: ORG, OTC: OGFGF, ADR: OGFGY) is Australia’s largest integrated energy company, with extensive E&P efforts focused on gas, one of the country’s largest, most flexible power generation portfolios and an energy retailing operation with 4.5 million customers.

Through its 42.5 percent stake in the USD20 billion Australia Pacific LNG project Origin holds a share in the country’s largest proved-plus-probable coal-seam gas (CSG) reserves. Along with ConocoPhilips (NYSE: COP), which owns 42.5 percent, and China Petroleum & Chemical Corp, better known as Sinopec (NYSE: SNP) and owner of a 15 percent share, Origin is developing one of Australia’s largest CSG-to-LNG export projects, with initial capacity of 9 million metric tons per year. Origin will build and operate the project’s gas fields and its main transmission pipeline.

During its full-year 2011 results announcement in August Origin forecast underlying EBITDA growth of 35 percent for fiscal 2012 compared to fiscal 2011 and underlying profit growth of 30 percent. Management reaffirmed this guidance during its Oct. 24 annual general meeting.

Origin is well placed to fund ongoing capital expenditure requirements, including the Australia Pacific LNG project, while preserving balance sheet strength. In recent months the company has completed a AUD2.3 billion equity raising via a pro rata entitlement offer to existing shareholders; executed AUD2.15 billion and USD350 million three- to five-year bank facilities; raised EUR500 million (AUD680 million) through a hybrid issue; completed the private placement of a 10-year, USD500 million note in the US; and executed a AUD800 million subordinated note offering with a 2071 maturity.

Growth funding is assured via AUD4.6 billion of undrawn debt facilities and cash as of Sept. 30, 2011. Origin’s underlying business also generated AUD1.3 billion of free cash flow in fiscal 2011. A solid E&P operation with a quality utility business provide a foundation for stable cash flow and dividend growth.

The Roundup

The Australian Bureau of Statistics (ABS) reported that the economy Down Under expanded by 1 percent during the third quarter and revised the expansion for the June quarter upward to 1.4 percent from 1.2 percent. In the 12 months through Sept. 30 Australia’s gross domestic product (GDP) grew by 2.5 percent.

Economists had been expecting GDP to rise by 1 percent in the September quarter for an annual rate of 2.1 percent. The Australian economy contracted in the March quarter after floods and cyclones in Queensland disrupted coal exports, shutting mines and cutting railways, but the third quarter certainly showed the impact of continuing mining and resource investment on this USD1.3 trillion commodity-based economy. Business investment increased by 13 percent, led by engineering work. Australia’s gas sector is building huge projects across the country’s north, while port, rail and mine expansions are also being pursued aggressively.

With USD450 billion in mining and energy projects either underway or in planning, the country’s resource-focused companies continue to drive growth.

There is, of course, the risk that Europe could tip into recession, and/or that Chinese policymakers’ response to slowing growth proves too little, late. Under worst-case global economic scenarios triggered by either or both of these critical regions some of the projects would be postponed or cancelled entirely. We saw this in 2008-09.

But we’re not near a 2008-style implosion. For one thing, the US continues to show signs of finally establishing some solid momentum, though election-year politics continue to threaten what remains a delicate recovery. And solid businesses have had ample opportunity to refinance balance sheets, establish new lines of credit or otherwise take on debt at what remain the lowest rates in history.

Amid all this uncertainty, the Australian economy continues to battle back from devastating floods a year ago, though Queensland’s coal mines, a key engine of growth, are still at only about 80 percent of capacity, with overall volumes in 2011-12 likely to fall short of forecasts. Should headwinds strengthen the Reserve Bank of Australia has plenty of room to apply traditional monetary policy responses, even after cutting its target overnight interest rate in November and December, by 25 basis points each time, bringing the rate to 4.25 percent.

Here’s when each of our current holdings is expected to go ex-dividend the next time. To collect the dividend, investors will have to be stockholders as of the “record date,” which is typically a couple days later. All dates shown are estimated.

Conservative Holdings

• AGL Energy Ltd (ASX: AGL, OTC: AGLNF, ADR: AGLNY)–Mar. 5, 2012
• APA Group (ASX: APA, OTC: APAJF)–Dec. 23, 2011
• Australia & New Zealand Banking Group Ltd (ASX: ANZ, OTC: ANEWF, ADR: ANZBY)–May 10, 2012
• Cardno Ltd (ASX: CDD, OTC: COLDF)–Mar. 7, 2012
• CSL Ltd (ASX: CSL, OTC: CMXHF, ADR: CMXHY)–Feb. 15, 2012
• Envestra Ltd (ASX: ENV, OTC: EVSRF)–Feb. 10, 2012
• Telstra Corp Ltd (ASX: TLS, OTC: TTRAF, ADR: TLSYY)–Feb. 9, 2012

Aggressive Holdings

• BHP Billiton Ltd (ASX: BHP, NYSE: BHP)–Feb. 17, 2012
• GrainCorp Ltd (ASX: GNC, OTC: GRCLF)–Jun. 15, 2012
• Newcrest Mining Ltd (ASX: NCM, OTC: NCMGF, ADR: NCMGY)–Feb. 11, 2012
• New Hope Corp Ltd (ASX: NHC, OTC: NHPEF)–Mar. 20, 2012
• Origin Energy Ltd (ASX: ORG, OTC: OGFGF, ADR: OGFGY)–Feb 24, 2012

Just as they pay dividends semi-annually, so do Australian companies report financials only semi-annually. That makes it doubly important to pay attention when the numbers do come out.

Companies typically announce earnings release dates a few weeks before revealing their numbers and making filings. As a result, the dates shown below are only expected reporting dates, which can vary several days or even weeks. Note that releases are classified as “interim”–which show how a company is doing at the halfway point in its fiscal year–and “final,” which is the fiscal year in full.

The notable exception here is ANZ, which actually does release quarterly earnings data. Approximate reporting dates for the company are Feb. 2, May 2, Aug. 18 and Nov. 2 (full year). Also, Newcrest Mining and Origin Energy issue a quarterly “Sales and Revenue Releases,” in addition to interim results. Newcrest even issues monthly updates.

Conservative Holdings

• AGL Energy Ltd (ASX: AGL, OTC: AGLNF, ADR: AGLNY)–Feb. 23 (interim), Aug. 24 (final)
• APA Group (ASX: APA, OTC: APAJF)–Feb. 22 (interim), Aug. 23 (final)
• Australia & New Zealand Banking Group Ltd (ASX: ANZ, OTC: ANEWF, ADR: ANZBY)–Feb. 2, May 2, Aug. 18, Nov. 2 (final)
• Cardno Ltd (ASX: CDD, OTC: COLDF)–Feb. 15 (interim), Aug. 15 (final)
• CSL Ltd (ASX: CSL, OTC: CMXHF, ADR: CMXHY)–Feb. 16 (interim), Aug. 16 (final)
• Envestra Ltd (ASX: ENV, OTC: EVSRF)–Feb. 23 (interim), Aug. 25 (final)
• Telstra Corp Ltd (ASX: TLS, OTC: TTRAF, ADR: TLSYY)–Feb. 9 (interim), Aug. 10 (final)

Aggressive Holdings

• BHP Billiton Ltd (ASX: BHP, NYSE: BHP)– Feb. 8 (interim), Aug. 24 (final)
• GrainCorp Ltd (ASX: GNC, OTC: GRCLF)– May 26 (interim), Nov. 23 (final)
• Newcrest Mining Ltd (ASX: NCM, OTC: NCMGF, ADR: NCMGY)– Feb. 9 (interim), Apr. 18 (qtr), Jul. 21 (qtr), Aug. 15 (final), Oct. 20 (qtr), monthly sales releases
• New Hope Corp Ltd (ASX: NHC, OTC: NHPEF)– Mar. 22 (interim), Sept. 20 (final)
• Origin Energy Ltd (ASX: ORG, OTC: OGFGF, ADR: OGFGY)– Feb. 22 (interim), Apr. 29, Aug. 22 (final), Nov. 2