Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Hansard source

It is great to join with my colleagues from the House of Representatives Standing Committee on Primary Industries and Resources to discuss this new report, Down under: greenhouse gas storage, and to join with my colleagues on the committee in recognising what a terrific committee it is. I cannot take any credit for any of the past good work that the committee has done. Its inquiries and reports in the past have really made some substantial contributions to the parliament and also to the industries that are supported and considered by the committee. Having joined the committee in this parliament, I am very much getting a sense of the sorts of things that the member for New England was talking about. It is a committee in which you are dealing with very significant, key Australian industries that support regions that are close to our hearts, that is for sure—and yours too, Mr Deputy Speaker Scott—and you feel like you are at the cutting edge, not just in dealing with challenges to those industries but also in getting some insight into the great opportunities that exist as we overcome some of those challenges. So it is a great committee to work with.

The inquiry into the Offshore Petroleum Amendment (Greenhouse Gas Storage) Bill 2008 that the minister referred to us for consideration was a great process to be part of, not just in working with my colleagues on the committee but also—and I record my appreciation here—to see the time and effort that the companies and organisations working in the resources sector put into their contributions to this inquiry. Going into the inquiry, I read as much as I could about the technical and legal aspects of the bill, but the real eye-opener for me and the value of the inquiry was to have major players and operators in the resources sector and the research sector coming to share with the committee their experience of the commercial and practical realities of what they are doing in their companies at the moment, what they need from this legislation to give them certainty in existing investments and what they need from the legislation to encourage investment in this important new industry of greenhouse gas storage. Throughout the process we were very conscious that we were dealing with questions that go to our national interest and the future of nationally significant industries.

There is no doubt, and we heard this from previous speakers, that there are huge issues at stake here that are very well encapsulated in my very own electorate. In the west of my electorate I have the communities and mines of the Bowen Basin, and on the eastern boundary of my electorate I have the Great Barrier Reef, which, as we hear from all the scientific evidence, is going to be one of the first ecosystems in Australia that will be impacted upon quite dramatically, in a devastating fashion, by climate change. So right there in my electorate I am faced with, on the one hand, how we secure the future of the coal industry and, on the other hand, how we reduce our emissions, because the clock is ticking on the sustainability of some of our national environmental icons in Australia.

In preparing this report we were faced with that whole juggling act between the threats of climate change and what we can do to reduce emissions and, on the other hand, the fact that 75 per cent of our electricity in this country is still sourced from coal-fired power stations. Our coal exports amount to $25 billion a year, and many of our other big exporters are also energy intensive industries.

In the last few years here in the parliament we really have seized on the opportunities and the answers that we hope clean coal technology offers to us in this country as we look for a solution to both sides of the problem—environmental sustainability versus our national prosperity, based as it is so much on the resources sector. The other side of it to me, as someone who represents an area based largely on coalmining, is that if we get carbon capture and storage technology right it has the potential not just to be the solution to that problem but also to be a huge opportunity in itself as part of a new industry where Australia can export that technology and knowledge to countries that are also trying to reduce their emissions.

One side of it is that there is an awful lot of work going on, a lot of it in my electorate, with Stanwell’s ZeroGen project involving the capture of carbon from those industrial processes and from electricity generation, but now we are getting down to the nitty-gritty of putting this into action and making it work to reduce our emissions, and that brings you up against the question of storage. How do you store it? Where do you store it? And, of course, very importantly, how do you acknowledge and protect the investments and the sovereignty of those companies that are involved in the petroleum and gas industry? That is what we were grappling with here.

The bill is about regulating and managing the injection and storage of carbon dioxide and also, very importantly, managing the interaction and protection of the legitimate property interests of pre-existing oil and gas operators. The bill as originally drafted was very much about regulating a future greenhouse gas storage industry, but after hearing the evidence the committee formed the view that the bill could and should be amended to facilitate and encourage the development of a greenhouse gas storage industry. I think it is true to say of the committee that we are supportive of a carbon capture and storage industry and can see ways, through the bill, that we can expedite the development of that industry and facilitate the investment needed to get that going. You can see that in the recommendations, such as recommendation 1, which suggests that we include an objects clause in the legislation. This recognises that the amendments to provide greenhouse gas storage are included in the offshore petroleum legislation. In the objects clause we really want to have it saying upfront that this is about greenhouse gas storage as well as a significant industry in its own right. Recommendation 3 deals with acreage release and suggests:

.. no acreage be automatically excluded from consideration for selection on the grounds of pre-existing petroleum activities.

Again, we want to do what we can to facilitate investment in greenhouse gas storage operations. Recommendation 13 calls on the government to provide financial incentives for early movers in this industry.

There are also the common-sense recommendations. One great thing about the committee process is that the companies that are investing big dollars and operating in the petroleum and natural gas industries appeared before us and we gained some insight for getting greenhouse gas storage happening in a big commercial way and encouraging investment. These operators in the oil and gas sector are already out there with their investments and property rights. How do we get the new industry going alongside those existing interests? We tried to come up with some common-sense recommendations that would facilitate the greenhouse gas storage industry at the same time as drawing on the expertise and information that the oil and gas industries possess from the work they are already doing.

Recommendation 9 is about the minister having the power to bring the parties together. Where there are potential or actual overlapping greenhouse gas storage possibilities and existing petroleum rights or prospective petroleum titles the minister will have the power to bring the parties together. Let us try to get some practical commercial arrangements in place that everyone can be happy with. It is very much based on the coal seam gas regime that operates in Queensland that the member for Moreton spoke about in his contribution. We have the national interest in mind in seeing if we can come up with negotiated arrangements to promote both of those industries.

Also along those lines is recommendation 11, which states:

... incumbent petroleum operators be offered a one-off opportunity to incorporate a GHG assessment permit over their exploration or production licence, with the condition that they must demonstrate utilisation of this permit within five years, or surrender it.

Again that is recognition that it is the oil and gas industries that have the existing knowledge and expertise. If we can give them the opportunity to drive this new industry, that could produce good outcomes all around.

One of the things in the legislation and in this report that has gotten quite a bit of attention is the stance that we took on the long-term liability. The bill lets common-law liability lie where it falls. After the evidence we took the view that it was reasonable and responsible for the Commonwealth government to take on that long-term liability under very strict conditions. That very much came from the evidence about the time frames involved. A company will be injecting greenhouse gases for 30, 40 or 50 years. You then have the site closure time frame. So you are talking about operational time frames of 50, 60 or 70 years potentially. The evidence very much was that it is at the start of the process that you are going to know whether there are any problems. After it has operated and been closed down for 60 or 70 years the residual risk to the Commonwealth is very small. This is something different, and I understand it might be something that the Commonwealth is a bit reluctant to do. I think we had very good reasons, based on the evidence, to make that recommendation.

Another important thing that my colleagues have not touched on that I do want to spend a bit of time on is recommendations 17, 18 and 19. These are very much about community education, consultation, transparency of information and sharing data with the public as the site closure processes are followed prior to the site closing certificate being issued. This is very important. It is something that the bill is silent on. It came out of the evidence rather than being something we were specifically requested to inquire into.

We talk a lot about clean coal technology and the importance of carbon capture and storage but we need to realise that even though we are dealing with these terms and processes in parliament all the time, they are very new to the community and we need to take the community with us on this. It is something that the CO2CRC, with their Otway project, has shown can be done very effectively. I think those recommendations 17, 18 and 19 that talk about the need for community consultation on projects and the need for data to be shared publicly are very important if we are going to get community acceptance of this very new but very vital technology. In closing, I look forward to seeing the government’s response to this. I encourage my colleagues in the government to respond quickly because we need that certainty for industry and we need to encourage investment in this technology which is so important for the future—not just for our industries in Australia but also in the quest for reduced emissions and sustainability.

Debate (on motion by Ms George) adjourned.

See this speech in context