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Thursday, 18 September 2008
Page: 7857


Mr SIDEBOTTOM (9:51 AM) —It is always nice to follow the Prime Minister. I am very pleased to be able to discuss this legislation, the Offshore Petroleum Amendment (Greenhouse Gas Storage) Bill 2008 and related bills, for a number of reasons and I would like to highlight those as I go. Most especially, I want to commend this legislation for its pioneering element and I want to commend the Minister for Resources and Energy, who is at the table, for the excellent work that he, his advisers and the department have done in producing what is fundamentally a framework piece of legislation to allow for what will be a very important part of our whole approach to carbon pollution reduction. In this instance we are talking of course about the Offshore Petroleum Amendment (Greenhouse Gas Storage) Bill 2008, which will establish a framework to allow people to prepare with certainty into the future to capture and then store carbon dioxide in our offshore reservoirs safely and securely, and we will be able to share with the rest of the world the technologies that are going to be encouraged by this. It is absolutely essential that we take the lead in this pioneering role which we share with others throughout the world, and I would like to discuss some of those a little bit later on.

Also, as the Prime Minister has just mentioned, this is part and parcel of a suite of legislation and schemes by which Australia, led by this government—so under this government—will attempt both to reduce carbon pollution in Australia and to make its contribution to reducing carbon pollution throughout the world. I think it is really important to note that by just about any measure the Australian population believe in this thing called climate change, even though it is rather amorphous at times, and that they believe climate change is occurring.

Yesterday I was in this House listening to the member for Tangney, who essentially repudiated the whole argument and the science for the rationale behind climate change. I was absolutely aghast because I regard the member for Tangney as having intelligence and articulation particularly in areas that I am particularly interested in, such as education. But I was staggered by the member for Tangney’s claim. But it was part and parcel of a contrary day for me yesterday.

I came across contrariness everywhere I went yesterday. It started with the member for Tangney then I picked up my newspapers and I came across the contrariness of others. As you know, Mr Deputy Speaker Bevis, along with you I have a passion for education, so I read in the newspaper comments by Mr Kevin Donnelly, Mr Contrary himself on education. It is Kevin Donnelly versus the rest of the world—and the rest of the world is wrong and he is right on education! I thought yesterday I would do a bit of historical reading and I came across Keith Windschuttle. Of course here we go again with this contrarian view of history that I was served up yesterday. So I thought I would go back for a bit of political comment and I came across Janet Albrechtsen’s work. Here was another contrary view of life. Of course you have to have contrary views once in a while, but yesterday the member for Tangney was completely contrary as if nothing was happening with climate change and it was all just seasonal—and I was staggered. He was supposed to be talking on this legislation—that is what I found extraordinary—and I do not think we ever got to the detail of this legislation.

This legislation is our attempt to do what we should do anyway: seek to attempt to reduce our carbon pollution. This framework seeks to do that, and I am very proud to be part of all this. I am very proud to have been part of the excellent inquiry which we have just conducted on the inquiry brief that we were given by the Minister for Resources and Energy. I think the report of the House of Representatives Standing Committee on Primary Industries and Resources is great reading for anyone who is struggling to sleep at night! It is called Down under: greenhouse gas storage. It is beautifully named—and I do not know which member of the committee suggested that! Anyway, one does not want to claim too much credit.

This is a significant piece of legislation and I was pleased to see that the minister directed this to a House of Representatives parliamentary committee—I thought that was fantastic—and I know that everyone on our committee was very pleased about that, and perhaps this process should be replicated more often in this place: put things in the House of Representatives parliamentary committees where we can do the robust investigation that we would like to do and hopefully arrive at consensus. I believe from the minister that, of all of our recommendations, there are perhaps two that we are going to discuss further—but that was a tremendous result and I do recommend this report to all my colleagues. I was very proud to be part of the inquiry and I congratulate the chair, my colleague the member for Lyons, for his work.

So what does this legislation do? I am a simple man and I like things to be simplified for me and I hope that I can go through and look at some aspects of this legislation and simplify them. Most specifically, the legislation establishes access and property rights for the safe and secure injection and storage of greenhouse gases into stable subsurface geological reservoirs in Commonwealth waters. In other words, we want to try to capture and store the carbon dioxide that is produced, most especially in the electricity production industries, through coal in particular and then transport and inject it into the ground and under the ground offshore. That is the heart of it. It sounds like scary science. But in actual fact our understanding of geological formations is quite extensive, having been gained over many decades, so we do have a very good knowledge of the geological structures that these gases are going to be injected into. We also look forward to these processes encouraging other technologies.

What else do we want to do? We want to provide project developers with certainty, because this is going to cost a lot of money. We want to be able to provide project developers with certainty. This is required to commit to major low-emissions energy projects involving CCS, carbon capture and storage. The legislation also allows for the establishment of an effective regulatory framework—we must have that—to ensure that projects meet health, safety and environmental requirements. Whatever we do has to be good science, good engineering, good technology and good for the environment. That means it will be good for all of us, and that is what this framework legislation seeks to do. What else will it do, simply? We want to create an environment in which industry can invest in CCS projects with confidence and to encourage the commercialisation of technologies which have the potential to play a vital role in reducing global greenhouse gas emissions in the future. It is not just here; it is worldwide. The great thing is that we will be able to offer our technologies to the world so that others can use them and our small footprint will become a larger footprint throughout the world.

The legislation also provides for appropriate consultation and multiple use rights with other marine users. We are going into an environment that many people use, including fishing and petroleum industries, and we have to ensure pre-existing property and use rights are properly preserved. They have rights there, and we have to ensure that those rights are respected. This regulatory framework sets out to create a mechanism so that people can use and co-use locations for a variety of reasons, and we need to do that safely and legally.

In effect, the proposed legislation recognises the need to, firstly, provide greenhouse gas injection and storage proponents with the certainty needed to bring forward investment; secondly, as I mentioned, preserve pre-existing rights of the petroleum industry as far as practicable to minimise sovereign risk to existing titleholders’ investment in Australian offshore resources; and, finally, provide assurance to the community that CO2 is stored in a safe and secure manner.

What is the context for this? I come from the renewable capital of Australia, Tasmania, which is based on renewable energy. It is excellent that the relevant minister is at the table, the Minister for the Environment, Heritage and the Arts, and I am really looking forward to hearing more about MRETs and the regulations involved with expanding the MRETs so that wind energy, particularly in Tassie, will continue to roar ahead—so much so that we will have so many wind turbines in Tassie that it will take off! I look forward to that. But I realise that we are a fossil fuel dependent economy. I am not used to brown and black coal; I thought they were racehorses where I come from.

However, it is a reality that we are a fossil fuel dependent economy. Indeed, 80 per cent of Australia’s electricity is generated from coal. That is a reality. So what do we do about it? First and foremost you face that reality and then you set out to clean it, and that is what this legislation is involved with, along with other policies of this government. Eighty per cent of our electricity is generated from coal. I also understand that some 40 per cent of the world’s electricity needs are based on coal and this will grow to some 44 per cent by 2030. I also understand, as the Prime Minister just updated the figures for us, it will be a $43 billion export industry in 2008-09. We are the largest exporter of coal in the world. Thirty thousand direct jobs are associated with this industry, so it is not something that you can walk away from. Others would have us close it down. I talked about the contrariness of the member for Tangney. We have contrariness in other places. Coal is absolutely essential to our economy and to our future. We can certainly lead the world in what we can do with carbon capture and storage.

So, for the non-scientific amongst us, what is involved with this carbon capture and storage, particularly in our offshore petroleum areas? CCS involves capturing greenhouse gas emissions, predominantly from coal-fired power stations, before they are released into the atmosphere, thus preventing the gases from entering the atmosphere and contributing to climate change—not easily done technologically, I might say, but a fairly simple concept. The gas is then injected and stored deep under the ground in geological formations similar to those which have stored oil and gas for millions of years. The original term for CCS was carbon dioxide geosequestration, but we call it CCS because we live on acronyms—you have them for breakfast in this place. The only other place I know that has more acronyms is Centrelink. They have extraordinary memories for acronyms. Anyway, CCS it is. That is what we use so that is what it will be. That is a technology that involves combined processes of capture, transport and geological storage of CO2, carbon dioxide, and/or other greenhouse gases.

For my simple brain, greenhouse gases may be produced by the combustion of fossil fuels or co-produced as a result of oil and gas extraction or some industrial processes. Instead of allowing the gases to be released into the atmosphere, because they are dirty, they are captured at the emission site where they are separated from other substances. The separated stream is then compressed into a concentrated volume and transported from the source location to the injection location. Geological storage comprises the injection of the compressed stream into the geological formation in the deep subsurface, its migration away from the immediate vicinity of the injection point and its subsequent trapping in geological formations.

I did a little bit of research, because the member for Tangney, the contrarian, yesterday was telling me how unsafe this practice could be. In that research I asked: are there other experiments with this? Is there some evidence to say that this can happen? I noticed that in Saskatchewan, Canada, CO2 is being used for enhanced oil recovery in the Weyburn field—there is a trip!—and in Poland CO2 is being used to help extract methane from coal beds that are too deep to mine, and, very interestingly, in the Norwegian North Sea, in the first direct sequestration project, naturally occurring CO2 is being stripped out of methane from the Sleipner field and reinjected into a deep saline formation for storage 900 metres below the seabed. Since that project started, over 10 years ago, one million tonnes of CO2 per year has been injected, and seismic techniques have monitored the successful dispersion and trapping of the gas within the formation. I believe also that in BP’s In Salah project in Algeria naturally occurring CO2 is being removed from natural gas and reinjected into the gas reservoir. Injection is at a rate of up to a million tonnes a year.

There is experimentation going on in Australia. The Otway project in south-west Victoria, operated by CO2CRC, is the first CCS project in Australia and is the world’s most advanced demonstration project based solely on storage without associated CO2 production. The project aims to demonstrate that up to 100,000 tonnes of CO2, extracted from a nearby natural accumulation, can be safely transported via a pipeline and injected and stored, while trialling a significant number of potential monitoring and verification techniques. To date, the Australian government has contributed in excess of $25 million to this important project.

To find out a little bit more—if I may share this with you to conclude—I looked to Rick Causebrook in AusGeo News, No. 76, December 2004. In answering the question: ‘How long will CO2 be trapped in the storage areas?’ Rick Causebrook wrote:

The petroleum industry is over a hundred years old and during this time geologists and other scientists have been studying the conditions under which oil and gas are generated and trapped in the subsurface.

For over 100 years they have been studying it. Further, he wrote:

The importance of oil to the world economy since the middle of the twentieth century has meant considerable resources have been directed at understanding the environment in which hydrocarbon accumulations occur and how they are preserved.

He went on to say:

Research in hydrocarbonbearing basins worldwide has shown that it is possible to determine the time that the source rocks started to generate oil and gas, and show how long these fluids have been held securely in the adjacent traps. In almost all cases this is tens to hundreds of million years. The fact that the sealing rocks have held naturally generated oil and gas accumulations over such a period, often with naturally occurring carbon dioxide, demonstrates that they can contain carbon dioxide that is purposefully injected into them for a very long time.

I am very pleased to speak on this legislation. It is part and parcel of a suite of schemes and projects that Labor want to introduce to help to reduce carbon pollution. (Time expired)