Gas ‘essential’ to clean economy

The resources industry has pledged play its part in the country’s climate change response.

General views of the INEOS plant in Grangemouth as the first shipment of shale gas from the United States arrived in Britain on September 27, 2016. - A £2 billion (2.3 billion euros, $2.6 billion) investment by Ineos, the world's third largest chemical company, will create a "virtual pipeline" with eight tankers transporting regular shipments across the Atlantic to Britain and Norway. (Photo by Andy Buchanan / AFP)

Australia’s natural gas stocks and gas-fired power stations must play central roles in the government’s long-term emissions strategy, with the resources industry pledging to invest and play its part in the country’s climate change response.

The Australian Petroleum Production and Exploration Association, representing companies including Chevron, Shell, BP, Woodside and ExxonMobil, has urged the government’s technology investment road map expert panel to prioritise gas in support of a clean economy.

APPEA, which joined the Minerals Council of Australia in endorsing the Paris Agreement, said maintaining the nation’s $49bn export market, which had doubled in the past two years, would also benefit “lower carbon economies in Asia”.

APPEA chief executive Andrew McConville said natural gas must play “an essential role in reducing emissions” because it was a cleaner fuel that could “see the emissions intensity of electricity generation fall, particularly on the east coast”.

“Gas-fired generators can be rapidly started, making them complementary with intermittent renewable energy,” Mr McConville said. “Alongside this opportunity at home, exporting natural gas as LNG will allow our Asian trading partners to reduce the emissions from their economies.”

The APPEA submission said flexible gas capacity would “continue to play a crucial role in supporting variable renewable energy” alongside improvements to energy storage, demand management and new grid technologies.

Mr McConville said the oil and gas industry would work closely with the government before the road map was released ahead of the October 6 budget. The road map will anchor Australia’s long-term emissions reduction plan due to be unveiled before the UN Climate Change Conference in Glasgow next year.

APPEA’s submission focuses on two technologies — greenhouse gas storage and hydrogen — as ones that can “achieve large-scale abatement and provide a large scale economic opportunity”.

An Industry Action on Emissions Reduction report, released by APPEA in conjunction with its submission, highlights “practical actions and initiatives” being undertaken by the oil and gas sector to reduce greenhouse emissions.

Both APPEA and the MCA on Wednesday welcomed moves by Opposition Leader Anthony Albanese to support Carbon Capture and Storage technology, which has been included in the government’s draft technology road map.

MCA chief executive Tania Constable, who released the mining industry’s first detailed Climate Action Plan on Monday, said Australia had “several highly prospective geological storage sites in Queensland, Victoria and WA”. Globally, there are 51 large-scale CCUS integrated facilities with 21 in operation and 28 under development.

Mr Albanese’s rejection of a nuclear energy industry in Australia was backed by EY energy leader Matt Rennie who said given the country’s “easy access to other green energy sources such as solar and wind the cost of building and installing nuclear reactors for energy production … simply don’t stack up”.

“There is a market particularly in the northern hemisphere for our uranium which we could be doing more to exploit, a number of mining companies are looking at this,” Mr Rennie said.

“Australia produces 13 per cent of the world’s uranium and has 30 per cent of resources so if it was part of the global energy mix that would be positive for the Australian mining industry.”