A Commonwealth plan to build a gas-fired power station in the Hunter Valley is "perverse" and "oxymoronic" according to Barnaby Joyce.
Speaking at the Business Chamber's State of the Nation event on Wednesday, Mr Joyce criticised his own government's plan to build a 1000 megawatt gas power plant in the Hunter Valley.
The former Deputy Prime Minister said government should instead build a coal power station among the Hunter's coal fields and build gas in Narrabri, or Gunnedah.
"It seems perverse that we're going to put a gas-fired power station where there are coal trains going past every day where there's a coal-fired power station that used to use coal," he said.
"If you want to build a gas-fired power station, sure, build it at Gunnedah, build it at Narrabri.
"And move the power by wire not the gas by pipe. Put it near the source of what you want to use."
Prime Minister Scott Morrison last week told a Newcastle audience the government would build a 1000 megawatt gas power plant to replace the Liddell coal power plant, which is due to close in 2023.
Mr Joyce pointed out the proposed Narrabri gas project, set to produce 35 terrajoules of gas a year, wouldn't produce the 50 terrajoules required to fire the 1000 megawatt gas plant.
A member of the audience asked Mr Joyce if his views on energy put him at odds with the government.
"That's not unusual," he replied.
The Member for New England warned the room full of businesses owners - who he said should "stand on their own two feet" and get off government welfare - that the world is in for a global recession.
He said Australia ought to focus on its primary export markets of coal and other fossil fuels.
"Without getting too carried away Sun Tzu said you have to understand your weaknesses and your strengths as a nation if you want to understand how to get through this recession that is coming our way," he said.