Woodside Petroleum hit with legal claim on $16.5bn Scarborough gas project

The energy giant faces a fresh legal challenge on its $16.5bn Scarborough gas project in Western Australia.

Woodside’s Pluto LNG plant in WA which will be expanded as part of the producer’s $16.5bn Scarborough gas project.

Woodside Petroleum has been hit with a last-ditch legal action against its $16.5bn Scarborough gas project in Western Australia with a challenge lodged over the state government failing to consider the environmental harm of approving the Pluto LNG plant expansion.

The Conservation Council of WA launched a Supreme Court of WA challenge on Tuesday against the development, which has just been signed off by Woodside and BHP and represents the biggest fossil fuel investment in Australia for a decade.

Gas from the offshore Scarborough field will be used to fill an expanded Pluto LNG plant near Karratha which the CCWA said was wrongly approved by the state‘s Department of Water and Environmental Regulation.

CCWA, represented by the Environmental Defenders Office, said the expansion sign-off was unlawful for failing to “properly consider and control the environmental harm generated by the development’s greenhouse gas emissions.”

“CCWA is hoping to ensure that all sources of greenhouse gas emissions released into the atmosphere are properly assessed by the WA government with respect to the environmental harm that they cause,” the council said.

Woodside, midway through a $40bn merger with BHP Petroleum, was also served with a legal challenge by CCWA on November 18. It said the offshore Scarborough gas field needed federal environmental assessment given the impact it would have on global warming and heritage sites including the Great Barrier Reef.

The EDO said on Tuesday that any additional carbon emissions would breach conditions needed for a safe climate.

Governments “and regulators – such as the CEO of the WA Department of Water and Environmental Regulation – should be doing everything in their power to properly assess and control any additional greenhouse gas emissions to mitigate the risks of climate related extreme weather events to the Australian people,” EDO managing lawyer Tim Macknay said.

“The CEO of DWER has a clear power and obligation to assess and control risks of environmental harm from highly polluting industry during the approvals process. The Conservation Council will argue that this did not happen and therefore the approval – which was granted by the CEO – is invalid,” he said.

DWER said: “As this matter is before the court it would be inappropriate for the Department of Water and Environmental Regulation (DWER) to comment.”

Green groups have previously set up a national campaign, Say No To Scarborough Gas, in an effort to cancel the project, despite Woodside already deciding to proceed with its development. Environmental activists immediately promised to halt the project, which Greenpeace described as the most “climate-polluting project ever”.

Sanctioning Scarborough and Pluto-2 will create more than 3,200 local construction jobs, WA Premier Mark McGowan said, with 600 roles ongoing although spiralling costs may place pressure on the budget for the development.

BHP will tip in $US1.5bn of investment for development of the giant offshore field with Woodside taking on costs of $US6.9bn. Woodside is targeting first supplies in 2026 and has spruiked it as one of the lowest carbon intensity sources of LNG for North Asian consumers.

Woodside chief executive Meg O’Neill has said the gas project was urgently needed to meet demand, noting an energy crunch in the last few months that swept Europe and parts of Asia, stating activists calling for the end of fossil fuels are “grossly divorced from the reality of the world’s energy needs”.

The issue of LNG production has become increasingly fraught.

In October, Andrew Forrest’s Fortescue Future Industries defaced a Woodside advertisement as a battle exploded over the resources giant’s green credentials on the eve of the pivotal COP26 climate summit. Fortescue rewrote Woodside’s advertisement on Twitter by crossing out the company’s Better Future brand and inserting its own name and renewable hydrogen credentials as the better alternative.

Still, Australia’s climate modelling predicts coal exports will halve by 2050 but the gas industry would keep growing.

Woodside and WA’s DWER were contacted for comment.