Australia’s oil and gas industry has urged the Commonwealth to immediately fix the broken offshore regulatory system after the backlog of energy supply and carbon capture projects awaiting approval was revealed.
Senate estimates heard how plans have been sitting in the approval process for an average of 562 days for exploration and for 400 days on average for development — as a result of regulatory uncertainty following a Federal Court ruling last year.
Projects that didn’t have any problems had an average wait time of around 180 days, depending on the plan.
The National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) confirmed that there were 42 environmental plans linked to energy and carbon capture projects, worth billions of dollars, before the court decision — and only five has since been approved.
Officials admitted that there are complexities concerning the regulations and the court interpretation of it.
Australian Energy Producers Chief Executive Samantha McCullock said: “The Commonwealth’s review of offshore environmental regulations must be fast-tracked now. The regulator has revealed the uncertainty and ambiguity of the regulations that are risking the energy security of Australia and its international trade partners.
“Projects that will provide reliable and affordable energy to Australian households and businesses have been held up 562 days on average in a huge blowout. A number of plans have been in the approval process for more than two years,” said McCulloch.
An approval also does not guarantee absolute certainty that a project will proceed accordingly as some companies have witnessed the court overturn the approvals granted by the national regulator.
McCulloch stated that governments must ensure robust and timely approvals or risk shortages and upward pressure on energy prices.
“Regulations that provide clarity and certainty for industry while maintaining comprehensive and meaningful consultation with stakeholders are urgently needed,” said McCulloch.