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Australia’s Woodside Sparks Outrage with New Gas Project

Announcement comes soon after the fast-growing energy player finalised a A$40-billion ($29 billion) deal to buy BHP’s fossil fuel assets

Gas plant
The Barossa project is led by Australia's Santos and partners include South Korean energy company SK E&S. Photo: Reuters


Australian environmental groups expressed outrage over plans for a vast new gas project off the country’s pristine northwest coast, saying it would undercut international climate efforts and pose an environmental threat.

Woodside Petroleum – fast becoming a major energy market player – announced plans on Monday to sink US$12 billion into developing the remote Scarborough gas field and a processing facility on the coast. It expects to begin exporting gas by 2026.

Experts and activist groups say the project is equivalent to building 15 new mid-sized coal-fired power plants, and makes a mockery of recent global commitments to halt fossil fuel investments.

“It is very big, it will result in about 1.6 billion tonnes of emissions over its lifetime, about 56 million tonnes a year,” Mark Ogge, principal adviser at the Australia Institute think tank, said.

“It’s just an incredibly irresponsible thing to be going ahead with as the world is doing its best to tackle climate change.”


A Future for Natural Gas

But analysts said Woodside was counting on a future for natural gas. “Woodside’s decision to greenlight a new LNG terminal in Australia suggests it doesn’t see hydrocarbon demand disappearing overnight,” Russ Mould, investment director at AJ Bell in London, said.

Woodside this week also finalised an A$40 billion ($29 billion) deal to buy BHP’s fossil fuel assets, creating what the latter called “a global top 10 independent energy company”.

One of the world’s largest mining companies, BHP is offloading its fossil fuel assets in a bid to boost its green credentials.

“BHP is serious about the threat posed by mounting environmental pressures, said Mould. “The deal to merge its oil and gas assets with Woodside enables it to be clear of assets at the sharp end of the so-called energy transition.”

Woodside has the support of Australia’s conservative government, which has shunned calls to decarbonise, insisting Australia will sell fossil fuels for as long as anyone is buying.


Among Largest Exporters

The country is already one of the world’s largest exporters of coal and gas, despite feeling the effects of climate change through worsening bushfires, droughts and flooding.

Resources minister Keith Pitt on Tuesday hailed the new project – which would operate into the 2050s – calling it “a great achievement” that showed “the demand for our gas and resources continues to grow”.

Woodside CEO Meg O’Neill indicated Scarborough would bring profits that would help “the funding of future developments and new energy products”.

Supporters argue that gas is less polluting than other fossil fuels and is a necessary bridge to a cleaner energy future.

But critics such as Greenpeace Australia slammed the Scarborough project as “toxic” and “Australia’s most climate polluting development ever proposed”.


  • AFP with additional editing by George Russell





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George Russell

George Russell is a freelance writer and editor based in Hong Kong who has lived in Asia since 1996. His work has been published in the Financial Times, The Wall Street Journal, Bloomberg, New York Post, Variety, Forbes and the South China Morning Post.


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