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CANBERRA (Reuters) - Car-loving Australians on Monday were offered cash rebates to convert their vehicles to run on liquefied petroleum gas (LPG) rather than petrol in a government move to reduce the country's dependence on Middle East oil.
Prime Minister John Howard unveiled a A$1.6 billion ($1.2 billion) program over eight years to help combat high world oil prices, but said there was no way to escape rising prices.
"This is a difficult time for Australians faced with high petrol prices," Howard told parliament.
He said world oil prices had risen by about 17 percent in the past year and the price of petrol at pumps had followed suit, causing voter anger at the rising cost of filling up the family car.
Under the new program, the government will give a A$1,000 rebate to people who buy new LPG-powered cars for personal use, and a A$2,000 rebate to people who convert their cars to use LPG.
An ACNIelsen poll in Fairfax newspapers on Monday said 75 percent of voters were unhappy with the government's response to high petrol prices -- about double the number who were dissatisfied about petrol prices a year ago.
Australia's 20.6 million people own about 10.7 million passenger cars. The country produces 4,600 megaliters (1,200 million U.S. gallons) of LPG a year and exports about 2,800 million liters a year.
Industry analysts said Australians have been slow to change to LPG-powered cars. Only a small number of vehicles can use the cheaper alternative to petrol, with the bulk of those used as taxis or commercial vehicles.
Industry Minister Ian Macfarlane said 25,000 to 30,000 cars currently used LPG, but about 3 million more could easily be converted.
"Australia is exporting LPG. We have ample supplies of it. What we wanted to do is increase consumption of LPG and increase Australia's self-sufficiency," he told Australian television.
Australia's main motoring body, the NRMA, said the measures would make it viable for people to convert their cars to LPG.
Spokesman Alan Evans said motorists who drive 15,000 km (9,300 miles) to 20,000 km a year would save A$30 to A$40 a week on their fuel bill. But he said Australia had shortages of people qualified to install LPG units in cars.
"This is something you cannot have your backyard mechanic do," he told reporters.
Howard said the government would also do more to encourage ethanol blends in fuel, with payments of up to A$20,000 to petrol retailers to help them install new pumps capable of selling ethanol blends.
Howard also announced extra funding for the government's chief geological organization, Geoscience Australia, to fund more exploration and mapping of potential offshore oil and gas fields.
He said Australia had some 40 offshore basins that displayed signs of oil, but half of them were unexplored.