Woodside Energy has made an eleventh hour decision to withdraw a multi-million dollar carbon capture and storage (CCS) project near a heritage-listed reef from the federal environmental approvals process.
A Woodside spokesperson, responding to questions about why it has withdrawn the Browse CCS project from the EPBC process, said the oil and gas giant needed to submit a revised referral following the changes to the federal environmental rules that passed last year.
“This is a procedural step and does not reflect any significant change to the nature, scope or intent of the proposed Browse CCS Project,” the statement said.
It’s the second CCS project to be withdrawn at the last minute from the EPBC process in the last two months because of the EPBC Act reforms.
Inpex pulled its giant Bonaparte CCS project from the EPBC process in January, citing the same reforms and just six months after it received federal major project status.
Inpex wants to store up to 300 million tonnes of captured carbon dioxide from the Ichthys offshore gas field under the seabed on a site about 250km offshore from Darwin.
In Western Australia, the Browse CCS proposal proposes to inject and permanently store up to 14,200 tonnes of carbon dioxide (CO2) per day under the sea, in a rock formation about 435 kilometres north of Broome, sequestering an average of up to 3-4 million tonnes a year.
The pitch by the oil and gas giant was that it would lock up just under half of emissions from the $37 billion Browse gas project, or 47 per cent.
But the CCS project was withdrawn from the EPBC on March 24, despite reaching the penultimate stage of final approvals.
“Woodside remains committed to progressing the CCS Project through a transparent and robust environmental assessment process and intends to resubmit the referral as soon as practicable,” the emailed statement from the Woodsode spokesperson says.
Former CEO Meg O’Neill went on the record in April last year saying CCS is too expensive.
Carbon bomb
The controversial “carbon bomb” Browse gas project extends Woodside’s North West Shelf gas fields and LNG production from 2030 to 2070.
Research by the Australia Institute shows emissions will be equivalent to 33 years of Australia’s entire emissions.
But it was hastily approved by new energy minister Murray Watt in May last year, after sitting in the EPBC for six years.
And while the Western Australian Environmental Protection Authority reopened public consultation in May as well, to give the public a chance to respond to changes proposed by the company, it ultimately decided the decision was one for the federal government given it’s in Commonwealth waters.
Even without O’Neill’s scepticism about CCS and despite federal approvals for the drilling side of the project in the bag, some analysts believe the likelihood of the Browse project generally going ahead is “shaky”.
In November last year, IEEFA gas analyst Josh Runciman said gas from the project would be too expensive to compete with that from Qatar, and too expensive for the Western Australia domestic market as well, because of the need for CCS and the techniques required to get the unconventional gas out of the ground.
“The project’s high emissions will likely increase project complexity and costs, with a proposed carbon capture and storage facility potentially adding more than 9 per cent to the project’s costs, impacting on competitiveness,” he wrote in an analyst note.
The federal EPBC greenlight in May included conditions that mean Woodside must reduce North West Shelf emissions by 60 per cent to 2030, and to net zero by 2050.
However, the Browse gas fields are believed to have a high CO2 levels of 10 per cent, which under the extension conditions will need to be fully offset from day one.
This is further hampered by the fact that big CCS projects haven’t worked yet in Australia, where the lack of penalty or carbon tax means there’s no serious financial incentive to do so.
Chevron’s Gorgon facility has seen carbon capture rates fall, not rise, since it started operations. In 2023-24, it only captured a third of its target volumes and cost $3.5 billion since it started.
By 2024, the cost of offsetting the emissions it’s been unable to sequester hit $222 to $265 per tonne — significantly higher than any carbon tax proposals in Australia.
* This article has been updated with comments from Woodside Energy.
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