With the federal government continuing to push it’s ‘gas led recovery’ agenda, their support for the fossil fuel industry remains a major blockage to Australia taking meaningful action on climate change.
In mid June 2020, it was announced that more than 80,000 square kilometres of new offshore acreage is being offered to oil and gas explorers in Australian waters. The 21 blocks range from the Browse, Carnarvon and Bonaparte Basins off Western Australia, and other basins off Victoria and Tasmania. Bidding on the blocks is due by March 3, 2022.
If even a handful of these areas are developed, it will lock in many decades of greenhouse pollution. This is a watershed moment, where many investors are shifting from fossil fuels, the industry is struggling for social license and faces the threat of investing in what will become stranded assets.
In a welcome move, the Morrison government announced in May 2021 that it would impose a temporary levy of 48¢ per barrel on the entire industry to fund a potential $1bn in remediation costs of a floating rig in the Laminaria and Corallina oilfields and associated infrastructure in the Timor Sea formerly operated by Woodside Petroleum. The Federal Government has been responsible for maintaining the Northern Endeavour floating storage and production facility and the associated Laminaria-Corallina fields since February 2020, when the owners were placed into liquidation.
This was a wise move by the Coalition, one that has been strongly opposed by the fossil fuel industry.
Australian Petroleum Production and Exploration Association (APPEA) chief executive Andrew McConville said: “Any levy is unreasonable in any form, but one being so extreme will be a major disincentive for investment at a time when policy stability and certainty is critical.”
If the government can be convinced to extend the levy to help cover all the future decommissioning costs of the industry, and strengthen the laws that currently govern decommissioning, it will act as a break on future offshore development.
Please add your voice to the call to make the levy permanent.