Roger Cook keeping an open mind about WA’s gas reservation...

Roger Cook keeping an open mind about WA’s gas reservation policy amid calls to lift onshore export ban

Josh Zimmerman and Matt Mckenzie

The West Australian

Fri, 17 November 2023 3:46PM

Premier Roger Cook has an “open mind” about changes to WA’s gas reservation policy as he awaits the findings of a parliamentary inquiry into the effectiveness of the landmark measure.

The closely watched inquiry comes at a critical juncture for the State Government as it attempts to balance the competing demands of slashing domestic emissions while continuing to aid global efforts to decarbonise.

Ensuring an ongoing supply of affordable gas is pivotal to both goals amid growing consensus the fossil fuel – which is less carbon-intensive than coal – has an important role to play as a transitional source of energy.

WA’s flagship domestic reservation policy requires 15 per cent of gas extracted from offshore projects to be supplied to the State. It has long been credited with keeping a lid on local energy prices.

The inquiry has heard repeated calls from energy companies to overturn a blanket ban on the export of onshore gas, which they argue will unlock investment in the hotly-contested Perth Basin and help plug projected shortfalls in the coming decade.

Speaking on the sidelines of the WA Energy Transition Summit, Mr Cook said he was “interested in understanding the issues (those companies) confront in relation to getting their projects going”.

“We’re continuing the conversations with them and importantly, we now have a parliamentary committee which is doing a long-term investigation and analysis of those issues,” the Premier said.

“And will be informed by the outcomes of that committee inquiry as well.”

Asked whether he expected the inquiry to result in changes to the principles underpinning the domestic gas reservation policy or just the way the 15 per cent requirement for offshore project is enforced, Mr Cook said he was not ruling anything out.

“Let me just say I’ve got an open mind in relation to the outcomes of that inquiry,” he said.

“We’re obviously not privy to the conversations that they have – other than the public hearings – but the government will obviously have an acute interest in their findings.”

Mineral Resources boss Chris Ellison is seeking a five-year exemption to the onshore gas export ban, which he has claimed would allow his firm to pull the trigger on a $1 billion plant capable of producing 250 terajoules per day connected to the Lockyer Deep gas field.

Without the exemption, Mr Ellison said MinRes would instead build a much smaller 30 terajoule plant.

Oil and gas giant Woodside has previously warned maintaining a ban on the export of onshore gas threatened the commercial viability of Browse, the biggest undeveloped gas field in the country.

That is because dwindling throughput from the Karratha Gas Plant meant the joint venture operating the facility was considering stripping back capacity from next year, reducing the future appeal of tapping into Browse.

Allowing “third-party gas” to be processed at Karratha would allow the facility to continue operating at full capacity in the decade it will take to bring Browse online.

Speaking from Friday’s summit, Woodside chief executive Meg O’Neill said she would be “excited about the opportunity to process gas from other (fields)” and highlighted WA’s LNG industry would never have gotten off the ground without access to international customers.

“If we had developed (North West Shelf) just for domestic use we would’ve never have developed it, it’s too big a gas resource for the market we have here,” Ms O’Neill said.

“Whilst the onshore fields are smaller, there is some sense to that narrative, you’ve got to be able to access both markets.”

The inquiry into WA’s domestic gas policy is due to hand down its findings and recommendations by the end of May 2024.