The Federal Government is set to finalise new offshore exploration permits for gas supply to firm renewables and support the economy as Australia makes the transition to net zero emissions.
The minister for Resources and Northern Australia, Madeleine King, will finalise permits for Esso and Beach Energy in the Otway and Sorrell Basins, with any discovered gas to support the domestic east coast market.
Exploration permits will also be finalised for Chevron, INPEX, Melbana and Woodside Energy on Australia’s west coast, supporting energy security in Western Australia.
In addition, 10 permits will be finalised for carbon capture and storage exploration.
The International Energy Agency, the CSIRO, the UN Intergovernmental Panel on Climate Change and Australia’s Climate Change Authority all identify that carbon capture, utilisation and storage will be needed to support the net zero transition.
As Australia’s economy transitions to clean energy, gas is required to firm renewables.
Since the Government has come to office, there has been a 25 per cent increase in renewable energy generation in the National Electricity Market, however the most recent ACCC Gas Inquiry Interim Report shows the domestic east coast market may experience gas supply shortfalls as early as 2027.
Supply challenges could persist into the mid-2030s unless new sources of gas supply are developed.
“As ageing coal generation comes offline in coming years, gas will continue to be needed to firm renewable energy generation and as a backup during peak energy use periods,” said King.
“Gas is critical for the transition. But it will be a diminishing proportion of our energy mix to 2050 as other storage technologies come online.”
The first principle of the government’s Future Gas Strategy is Australia needs to reach net zero emissions by 2050.
Gas demand will decline sharply during the transition to clean energy, but steps to secure supply will still be necessary to ensure domestic demand can be met.
The Future Gas Strategy makes it clear the Government will focus on optimising existing discoveries and infrastructure, and aligning with our net zero targets.
The finalisation of offshore exploration permits does not automatically allow new offshore gas production to occur.
Separate and extensive safety and environmental approvals are required through Australia’s independent National Offshore Petroleum Safety and Environmental Management Authority.