Activist investors are taking aim at APA Group in the first...

Activist investors are taking aim at APA Group in the first shareholder resolution filed in Australia targeting an oil or gas pipeline company over climate disclosure.

Market Forces, an affiliate of Friends of the Earth, has lodged a resolution that will go to shareholders at APA’s annual general meeting calling on the company to report on how its plans for pipelines to transport gas from thehuge Beetaloo Basin resource in the Northern Territory aligns with its climate commitments.

APA is studying pipelines that would transport gas from exploration ventures in the Beetaloo Basin in the Northern Territory. JustinMcManus

The resolution, filed on behalf of 128 shareholders in Sydney-based APA, is expected to be disclosed by APA on Wednesday in a statement through the ASX.

It comes as APA’s board, led by chairman Michael Fraser, is already under pressure afterlast year recording a “first strike” over its remuneration report amid concerns that performance targets for incentive payouts to senior executives were not ambitious enough. This year’s AGM is due to take place in Sydney on October 24.

The resolution asks for disclosure over the impact on scope 1, 2 and 3 emissions that would be added to APA’s total emissions if it proceeds to build pipelines being considered for Beetaloo gas explorers Empire Energy and Tamboran Resources, and how they would be compatible with the company’s emissions reduction targets.

It also calls for information on the level of offsets APA expects to use to manage additional Beetaloo emissions and the estimated cost of abatement measures.

APA, which manages $27 billion worth of pipelines, power lines and renewable power generation projects, hasan agreement with Empire for processing infrastructure that could be used for the explorer’s Carpentaria pilot project and to transport Beetaloo gas to the east coast markets.

Last December it also signed three binding agreements with Tamboran Resources focused on supporting the development of its huge gas resources, including early work on two separate pipelines that could transport the gas to market.

Market Forces oil and gas campaigner Rachel Deans said APA had to “come clean” with its shareholders and be fully transparent about whether the pipelines were compatible with its climate goals.

At last October’s AGM, APA recorded a 25.8 per cent vote against its remuneration report.

It was dealt a 20.6 per cent vote against its climate transition plan at the previous year’s shareholder meeting; since then, it has set a new target to reduce methane emissions from its operations, involving a reduction of at least 30 per cent by the 2030 financial year compared to 2020-21. APA is due to release its next climate transition plan in 2025.

APA confirmed it had received the Market Forces resolutions and said it was considering their validity, while noting it is supported by about .0071 per cent of the shareholder register.

Information ‘transparently disclosed’

A spokesman said APA’s notice of meeting, to be published “soon”, would include any valid resolutions for the AGM and a response and voting recommendations from the board.

“APA is committed to actively participate in Australia’s energy transition and we seek to transparently disclose relevant climate-related information, including our progress against the targets and goals within our climate transition plan,” he said.

“APA is committed to continue to engage with investors, communities and other stakeholders to make the necessary investments to support Australia’s decarbonisation ambitions.”

Market Forces has already been targeting APA’s largest shareholder UniSuper in an online campaign, UniSuper Divest, which calls on members of the superannuation fund to urge it to drop its implicit support for gas fracking in the NT.

The targeting of APA over the potential development of Beetaloo gas follows earlier campaigns focused on Tamboran and Empire.

It comes after the Albanese government in May adopteda strategy that locks in the use of gas beyond 2050 to support renewable power, manufacturing and energy exports. The analysis that underpins the strategy names Beetaloo as one of the three most likely gas provinces to be developed for large-scale supply, alongside the Surat Basin in Queensland and the Narrabri Basin in NSW.

APA has been diversifying its business to include electricity transmission and renewable power generation as it seeks to reduce its reliance on gas transportation and improve the resilience of its portfolio in the decarbonising energy system.

Market Forces claimed that all 36,300 tonnes of carbon offsets retired by APA in the 2022 and 2023 financial years represented no genuine abatement. It said annual emissions from fracking in the Beetaloo Basin and processing the gas at the Middle Arm industrial precinct near Darwin would produce up to 49 million tonnes of CO₂ a year, adding 11 per cent to Australia’s current annual emissions, citing analysis by Climate Analytics.