UPDATE 1-Australia PM appoints new resources minister in reshuffle

Sun Mar 24, 2013 10:45pm EDT

* Reshuffle comes after botched leadership coup

* Former Woodside Petroleum adviser Gary Gray appointed resources minister

* Climate change department to be merged with industry department

* Reshuffle leaves treasurer and finance minister posts unchanged (Adds details)

CANBERRA, March 25 (Reuters) - Australia's prime minister appointed Gary Gray, a former adviser to the country's largest oil and gas firm Woodside Petroleum, as resources minister on Monday in a cabinet reshuffle forced by a string of ministerial resignations.

Gray, a senior Labor party figure in the resource-rich Western Australia state, should ensure an advocate for the resources industry remains in place at a time when investment in the sector is slowing amid signs the mining boom has peaked.

Prime Minister Julia Gillard also said the Climate Change Department, which has overseen the introduction of a controversial carbon tax, would now be merged with the Industry Department, and would be overseen by Climate Change Minister Greg Combet.

However, Gillard made no changes to the crucial Treasury or Finance Ministry, held by Deputy Prime Minister Wayne Swan and Penny Wong respectively.

The reshuffle was forced on the government after a botched leadership coup last Thursday by forces loyal to former leader Kevin Rudd, with three cabinet ministers and two junior ministers quitting after supporting Rudd.

Gillard has set elections for Sept. 14, which opinions polls currently show she is almost to certain to lose, meaning the reshuffle's impact is likely to be limited.

Among those to resign was former Resources Minister Martin Ferguson, who was regarded as a business friendly minister and a strong supporter of the mining industry in Gillard's cabinet.

Around A$400 billion ($418 billion) has been invested in Australian resources projects over the past decade, with a further A$200 billion in liquefied natural gas projects, but the boom appears to be slowing.

The mining employer group Australian Mines and Metals Association (AMMA) said Gray was well known to the industry and should help attract investment to the sector.

Gray joined the Labor party in 1974. He quit the party in 2000 to work for conglomerate Wesfarmers and later as a public relations adviser for Woodside Petroleum, in order to help shape its defence in a takeover battle with Royal Dutch Shell.

Shell eventually withdrew its bid after it was deemed harmful to the national interest by then Treasurer Peter Costello, thanks in part to Gray's campaign to muster public sentiment against Shell.

($1 = 0.9572 Australian dollars) (Reporting by James Grubel; Editing by Ed Davies)

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