Glenn Sterle (WA, Australian Labor Party, Shadow Assistant Minister for Road Safety) Share this | Hansard source

I rise to speak to two pieces of legislation, the Offshore Petroleum and Greenhouse Gas Storage Amendment (Miscellaneous Amendments) Bill 2019 and the Offshore Petroleum and Greenhouse Gas Storage (Regulatory Levies) Amendment Bill 2019. These bills build on existing legislation of the same name from 2006 that regulates offshore carbon storage activities. These bills shift the oversight authority of offshore carbon storage from the responsible minister to the National Offshore Petroleum Safety and Environmental Management Authority, also known as NOPSEMA. NOPSEMA is a highly regarded Commonwealth agency that already regulates and enforces offshore petroleum operations. It performs monitoring, assessment, data analysis and enforcement across more than 900 offshore wells and their operators. The opposition considers that NOPSEMA is the best placed agency to have oversight of offshore greenhouse gas storage.

This bill proposes a number of amendments to strengthen NOPSEMA's ability to monitor, investigate and enforce breaches of offshore oil and gas operations, with the intention of keeping workers and the environment safe and healthy. Currently, offshore petroleum activities cannot commence unless NOPSEMA has accepted detailed risk management plans that document and demonstrate how an organisation will manage the risks to health and safety and the environmental risks to as low as reasonably practical.

As well as being a regulator of offshore petroleum activities, NOPSEMA is also a developer of safety and environmental benchmarks, and it undertakes an educational role in the offshore energy sector. NOPSEMA has an enforcement function and can pursue remedies that include offence provisions, civil penalties and enforceable undertakings. The monitoring and inspection role of NOPSEMA officers includes both warrant and warrant-free searches and inspections. Much of NOPSEMA's role occurs behind the scenes working with industry, and the authority has a team of scientists and engineers. A lot of their work entails detailed examination of data that has been provided to them by operators.

Let's look at the bills in detail. The Offshore Petroleum and Greenhouse Gas Storage Amendment (Miscellaneous Amendments) Bill 2019 amends the legislation of the same name from 2006 which I mentioned earlier. It covers the well management and environmental management of offshore greenhouse gas storage operators and shifts oversight authority from the minister to NOPSEMA. The amendments bill strengthens NOPSEMA's role as it moves to regulate greenhouse gas storage. The bill reverses the burden of proof in specific incidents, requiring that the storage operators show that they do not do unlawful acts, rather than NOPSEMA having to prove it. Such a reversal is justified because in some cases the storage operator is the only party that could know what has actually occurred to produce a dangerous incident.

Secondly, the amendments bill empowers NOPSEMA to conduct monitoring activities on storage operators without a warrant. Labor believes this amendment will significantly increase the safety of workers and improve the environmental footprint. Thirdly, the amendments bill allows NOPSEMA to issue enforceable undertakings to offshore carbon storage operators, but not when the incident in question has resulted in a fatality or when the operator has a track record of incidents.

The amendments bill fixes up a taxation oversight. The frontier area tax scheme allows a petroleum explorer to claim a 150 per cent deduction on exploration expenditure in frontier areas under the PRRT. Four frontier areas were not included in 2005, and this amendment fixes the oversight retrospectively, with no revenue implications—very important. NOPSEMA is a cost-recovery funded agency. The regulatory levies bill establishes a schedule of levies to be paid by the offshore greenhouse gas storage operators.

Fundamentally, these bills help ensure that Australia has the safest and most environmentally responsible methods for pursuing carbon capture and storage in our offshore oil and gas fields. Carbon storage operates by taking carbon dioxide from industrial processes and pumping it deep underground into appropriate geology. The world's largest carbon storage projects take CO2 produced from power generation and LNG processing. This operation requires that carbon dioxide is compressed and then pumped under high pressures so it is injected into the geology. The sequestration site for the carbon dioxide can be up to two kilometres below the seabed. Typically the best formations for this carbon storage task are areas which have already been used for petroleum extraction.

Carbon capture and storage is recognised by the International Energy Agency as a key technology for reducing national greenhouse gas emissions. According to the IEA, carbon capture and storage can remove up to 85 per cent of carbon dioxide emissions from power stations. The IEA's Sustainable Development Scenario says that seven per cent of the required global cumulative emissions reductions to 2040 will come from carbon utilisation and storage. The United Nations Intergovernmental Panel on Climate Change, the IPCC, says that, without carbon capture and storage, the cost of achieving a two-degrees warming outcome by the end of the century increases by 138 per cent.

There are more than 40 carbon storage and utilisation project operating around the world. However, the biggest carbon storage projects are right here in Australia. The world's largest carbon capture and storage project is operating at an onshore site just off that magnificent part of Australia called the West, at Barrow Island—the Gorgon Project. I'm from Western Australia!