Woodside agitating for aggressive action on climate change

Australian gas exporter says the industry must be part of the solution and do more to tackle global warming.

Woodside CEO Peter Coleman. Picture: Jane Dempster

Energy giant Woodside Petroleum has hit back at gas industry critics, insisting LNG producers were not “the cigarette industry” and had unfairly suffered a black eye amid heightened concerns over global warming.

The Australian gas exporter said the industry must be part of the solution and do more to tackle climate change, which Woodside now ranks as the largest risk to its business.

“We are not the cigarette industry and do not want to be viewed as such. And that is a very real risk if we do not take action now,” Woodside chief executive Peter Coleman told a Saudi Arabian oil and gas conference.

“As the world reckons with the consequences of climate change, the pressure to reduce emissions will continue to increase.”

Woodside has been agitating for the Australian government to take more aggressive action on climate change, including the adoption of a national carbon price as part of efforts to cut emissions.

However, it also resisted ambitious carbon offset rules floated by the West Australian government last year, arguing the zero emissions guidelines would hobble a lucrative pipeline of looming investment decisions.

The Perth-based corporate risks being swept up in an accelerating global attack on big polluters, including gas companies, with big investors and pension funds piling pressure on companies to aggressively move to a lower carbon economy.

Climate change had catapulted from a business issue to the company’s biggest risk in the past five years, raising questions over Woodside’s ability to recruit staff, sell a product its customers want and finance its growth plans given deteriorating sentiment over the sector.

“With new employees coming into the industry, do they want to be part of an industry that at the moment is getting a bit of a black eye to be quite frank with you and I think unfairly,” Mr Coleman said in a Bloomberg interview at the conference.

Climate change “has certainly come onto my risk register as the largest thing that we need to be thinking about as a company. So five years ago climate change was not the biggest issue that we were dealing with. Today it’s by far the biggest issue.”

Still, Woodside argues the world needs its energy resources, with natural gas playing a part in displacing higher emitting fuels like coal as the world strives to meet the goals of the Paris climate accord.

Mr Coleman warned in September the gas industry risks going the same way as coal unless it does more on emissions, warning “one cataclysmic weather event” attributed to climate change could see governments force companies to cut emissions at a level they are unprepared for.

Asked about Australia’s ongoing bushfire crisis, Mr Coleman called it a “very unusual event” but said it should be used as a trigger for a heightened response on tackling climate change once the immediate danger clears.

“The images are ones that are very startling and quite shocking when you think about it. Not just the loss of the forest themselves but of course the wildlife and the effect on the people that live there,” Mr Coleman said in the interview.

“The debate in Australia is obviously amping up with respect to its intensity. I think you’ve got to let us get through the triage of trying to repair what’s happened and then that debate needs to occur and it needs to occur quickly.”