Greenhouse gas (GHG) emissions from the fast-expanding Australian liquefied natural gas (LNG) industry since 2014 have grown from 13 to 60 million tonnes per annum (Mtpa) in just five years, offsetting the reduction in emissions from the electricity generating industry over the same period.

Australia now rivals Qatar as the world’s largest exporter of liquefied natural gas (LNG). Electricity emissions have declined due to the expansion of renewables for generation and the declining supply from coal-fired generators. However, the 360% expansion of LNG production since 2014 has been accompanied by a likely 460% growth in the industry’s domestic greenhouse gas emissions.

There are four main reasons behind it:

First, three out of the four new LNG plants in WA and NT – Gorgon, Pluto and Ichthys – source their raw gas from gas reservoirs containing 9 v%CO2, which is about three times the CO2 content of the reservoirs which supplied the LNG plants operating in 2014.

Second, the three new plants at Gladstone, Queensland process coal seam gas (CSG) resources. These may have a low CO2 content but are produced in the extensive gas fields at very low pressure and from thousands of low-productivity wells. In addition, those resources are far from the plants (400 to 500 kms) which will lead to significant leakage of methane and other emissions.

Third, the largest Australian LNG plant (Chevron’s Gorgon 15.6Mtpa project on Barrow Island – layout and picture below) failed to commission its required CO2 reinjection system until August 2019, about 2½ years behind schedule since the first of its three ‘trains’ were commissioned in 2016. This caused about 4 MtCO2 to be vented above its permitted quantity.

Fourth (and most concerning), between 1989, when the first LNG was shipped from the NWS (North West Shelf) consortium’s plants on the Burrup Peninsula near Karratha WA and 2014, the original gas reservoirs lost pressure through depletion. By now most of the closest to shore and ‘best’ reservoirs have already been consumed. When depletion occurs, this will typically lead to processing higher- CO2 content gas, leading to significant increases in their emissions.

Measurement and reporting of emissions from the LNG industry is made opaque by the classifications used by the Department of Environment and Energy. In addition, this paper mentioned how severe the situation is and also some misleading common knowledge in LNG industry that are ignored (inadvertently or intentionally) by the regulator.

Market factors in 2019 and again in early 2020 with the COVID-19 event and the Saudi-Russian oil war have reduced prices, margins and operating rates for the Australian LNG industry, and GHG emissions have reduced accordingly. The poor LNG market conditions should provide a window of opportunity to re-evaluate some planned (and approved) projects that would make the Australian LNG industry even more polluting, could be a chance to reverse the current situation.

1. Since 2014 Australia’s LNG industry has undergone a huge boom in investment and growth in exports it is now No.1 in the world.
2. Due to a lack of regulation Greenhouse gas emissions have become a severe issue and a cost both financially and ecologically.
3. The older plants have already (or will soon have) depleted their initial gas reservoirs and are using or planning to develop reservoirs with higher CO2 gas contents. The new (and planned) plants are developing gas reservoirs with increasingly higher levels of CO2 or using low pressure CSG resources far from the plants.
4. All LNG exporting nations other than Australia (including Qatar, PNG, USA, Trinidad, Indonesia, Malaysia) either have national oil companies and/or administrative regimes which have powers to licence energy exports. They are thus able to extract substantial and equitable returns to the national estate on behalf of its citizens. Several of these authorities also take an active national interest role in the planning of LNG plants.
5. The extreme ‘laissez-faire’ regime in Australia has not served the nation’s interests in either financial returns or in clarity about controlling their emissions. Australia’s GHG emissions are reported, and projections are made by the Department of Environment and Energy in eight sectors. For some unknown (or perhaps no good) reason, these sectors do not align with the UN Environment Department reports which show seven sectors. Five of these sectors appear to correspond by their simple descriptions, but the detail of the classifications is beyond the scope of this paper.
6. People now have greater public awareness of the global hazards of such significant emissions. In the interests of reducing CO2 emissions, maintaining a social licence to operate, and compensating for past opportunities lost, it should be possible to implement some changes to improve this situation. At the very least those emissions which are already captured and concentrated, such as from the Acid Gas Removal Unit (AGRU) vents, should be stored and dealt with appropriately.
7. The poor LNG market conditions in 2019 and 2020 should provide a window of opportunity to re-evaluate some planned (and approved) projects that would make the Australian LNG industry even more polluting - just when the need for urgent emissions reductions is becoming more apparent to many more people here and around the world.