Gas the 'main game' as firms join political battle cry

·3-min read
Matt Turner/AAP PHOTOS

A coalition battle cry for the gas industry to stand up for itself in the push to decarbonise the economy has been taken up by the boss of a major Australian energy company.

Santos chief executive Kevin Gallagher said the nation could be a carbon capture superpower, taking emissions from gas production and heavy industries as a world leader in the field.

"The main game is gas because it makes renewables possible," he told an industry conference in Adelaide.

If Santos could deliver abated gas to customers for about $24 a tonne, this would decrease the cost of the energy transition, he said.

Opposition Leader Peter Dutton told the Australian Petroleum Production and Exploration Association conference Labor was doing everything possible to shut down coal and frustrate the gas sector.

Yet a budget surplus would not have been possible without the support of the industry, Mr Dutton said.

"They're jeopardising Australia's energy security and they're discouraging foreign investment," he said.

Gas remains in the regulatory crosshairs, with Labor's energy policy driven by "renewable zealotry", the opposition leader added.

Mr Dutton said the government's first budget in October last year was an "all-out attack on the gas sector", followed by price fixing that had failed to stymie power bill rises.

A proposed mandatory code of conduct meant the government would dictate gas prices in the east coast market, he said.

Reforms to the safeguard mechanism force heavy industry to cut greenhouse gas emissions by 4.9 per cent a year or pay penalties.

"It's a new carbon tax - let's call it for what it is - and it's three times more than the one put forward by Julia Gillard," Mr Dutton said.

The "worst is yet to come" with proposed changes to environmental laws and a new Environment Protection Agency.

"Environmental approvals will be harder to obtain, slower to authorise and certainly more expensive," he said.

Environment Minister Tanya Plibersek said Mr Dutton was waging an ideological war while Labor was making sure Australian homes and businesses had the energy they needed.

"My role in all of that as environment minister is to make sure that that energy comes in a way that is most environmentally sustainable," she said.

The industry is calling for a national carbon capture road map and investment incentives to boost energy security and cut emissions, warning the country is in danger of losing out to the United States.

Mr Gallagher said the Moomba carbon capture and storage project under way in South Australia would be a game-changer for the future of gas in Australia and Asia.

"It will allow existing energy infrastructure, appliances and industrial processes to continue to be used while new technologies are commercialised over time," he said.

Mr Gallagher said the Cooper Basin, near Moomba, could store up to 20 million tonnes of carbon a year for the next 50 years. The project is one year away from its first injection of carbon dioxide,

ExxonMobil executive Alan Black said the Gippsland Basin was a prime location to support storage of large quantities of carbon.

Hydrocarbon production from the offshore Bream Field ended in 2020, which would normally mean decommissioning and removing equipment. Instead, Bream will store carbon supplied via a repurposed gas export pipeline.

A new Air Liquide facility, adding to one already in operation in Adelaide, will capture and reuse exhaust from the Longford gas conditioning plant in Gippsland and sell it to local manufacturers.

Mr Black said the technology was "gaining unprecedented momentum worldwide" and Australia needed to realise the race was on.

But plans for carbon capture at Woodside's depleted Angel field off the northwest coast of Western Australia have stalled, despite assessment permits being granted last year.