ESSO has officially opened its new gas conditioning plant at Longford in Gippsland, promoting it as the largest domestic gas project on Australia's eastern seaboard, and one that will give certainty to the state's gas supplies for about 40 years.
The development will supply 1.6 trillion cubic feet of gas to eastern Australia, which Esso says is enough to power a city of one million people for 35 years.
The conditioning plant represents the completion of the $5.5 billion Kipper Tuna Turrum project in Bass Strait, which has resulted in the development of two new gas fields and the upgrade of a third. The plant will remove excess carbon dioxide and mercury from the gas taken from the offshore gas fields, which will then be processed at Longford.
This is certainly welcome news for local employment. The company says that construction of the plant ‘generated more than 800 direct jobs’.
But there are some significant environmental problems with the plant.
1/ greenhouse pollution
Wellington Shire Council granted planning permits for the plant in 2013, despite fears that it would increase the state’s greenhouse emissions by one million tonnes a year.
Back in 2007, Phil Hart, a petroleum facilities engineer, and representative of the Association for the Study of Peak Oil said:
“The gas conditioning plant is required to treat new production from the Kipper gas field. The downside is that it would emit a million tonnes of CO 2 every year. While not quite in the same league as a coal-fired power station, this is not the right approach to achieving urgent CO 2 reductions.
Natural gas piped from Longford to our stoves must be quite pure. Esso therefore plans to build a processing unit to separate the CO 2 from the gas. The result will be a concentrated waste stream of CO 2, perfect for sequestering in an older oil or gas field nearby. So, what does Esso plan to do with it? Its proposal is to vent it to the atmosphere”.
Phil suggested that “perhaps the sequestration option is less profitable and Esso/BHP would rather not lead us down that path”.
After the opening of the plant in 2017, Friends of the Earth approached the company to find out whether the plant would be emitting this much CO2 into the atmosphere. The company did not respond.
The current estimate is that around 800,000 tonnes will be emitted per year.
This is equivalent to adding 200,000 cars to Victoria’s roads (this figure is based on a report into the SaskPower carbon capture and storage (CCS) facility at Boundary Dam Power Station in Canada).
2/ locking in further investment in fossil fuels
Anyone who is paying attention to climate science knows that the time for any form of new fossil fuel development is over.
Investing $5B in new gas infrastructure means that ExxonMobil will do its best to maximise gas production in order to offset their costs in establishing the plant. The decision to approve the new plant went against the precautionary principle. Compelling evidence about fossil fuels contribution to global warming and the need to keep the majority of know fossil fuel reserves in the ground to avoid dangerous climate change was widely available at the time the plant construction was approved.
3/ Inconsistent with state government policy
In early 2017, the Victorian parliament approved changes to the Victorian Climate Change Act, which commits our state to net zero emissions by 2050. There will be emissions reduction targets announced for each five year period to meet this target. This means that in each five year period we must be producing less emissions.
Allowing an additional 800,000 tonnes of CO2 pollution a year is inconsistent with this commitment. While the approval occurred before the 2050 target was set, it underscores the fact that the state government cannot allow any further development of fossil fuels in Victoria if we are to meet our emissions reduction targets.
What’s the deal with Esso?
Esso is part of the oil and gas giant ExxonMobil, which has a terrible track record on climate change. Exxon was aware of climate change, as early as 1977, 11 years before it became a public issue, according to a recent investigation from InsideClimate News. This knowledge did not prevent the company (now ExxonMobil and the world’s largest oil and gas company) from spending decades refusing to publicly acknowledge climate change and even promoting climate misinformation.
Then there is the issue of them not paying taxes: The company has managed to pay zero tax in Australia for two years, despite making $18 billion in sales.
As noted by Michael West, “Exxon is BHP’s partner in the Bass Strait offshore oil and gas fields and a big beneficiary of rising gas prices. While East Coast commercial and industrial gas customers have been getting slugged astronomical prices of $12-$15 a gigajoule for long-term supply contracts, Exxon shareholders have been pocketing record dividends”.