Labor supports these bills and agrees that the taxpayers should not be left to pay for the decommissioning and remediation of these sites.
However, decommissioning is something that the government has known about for years and has, as always been too slow to act on.
The committee has heard about the dangers of decommissioning work. In evidence to the committee the conditions on the Northern Endeavour have deteriorated and there has been a number of near misses including on the Mermaid Searcher which was working around the Northern Endeavour as well as incidents on nearby platforms. More recently the risks posed in this sector were laid bare by a tragic incident onboard a Libyan floating storage and offloading unit (FSO) which, during preparations for the vessel to be towed, a chain snapped, killing three workers who were thrown overboard and maiming one. Another worker remains missing after the incident, with questionable prospects of survival.
The government needs to ensure that workers who participate in the decommissioning process are appropriately trained and kept safe while also ensuring there is the appropriate levels of regulatory oversight.
As the Department of Industry, Science, Energy and Resources (DISER) tender in July 2021 said, that the removal of the Northern Endeavour 'will set the standard for future similar activities in Australian waters'. As the report noted there were a number of submitters who highlighted their concerns about the definition of decommissioning, which included the works or any other treatment.
While, on the face of it, re-purposing petroleum platforms to be an artificial reef may sound fine, it could open the door for producers to undertake less than full removal, which could present environmental risks particularly given the materials involved in the construction of these projects.
Labor accepts that under certain circumstances artificial reefs that are built up on this infrastructure can have positive impacts however, it is critical that removal of assets remains the objective of proper decommissioning.
The powers this bill grants the Minister for Resources in relation to their ability to vary the rate and length of the levy is concerning. It is important to ensure that the levy doesn’t end before the work is complete, and ensure no costs fall on the tax payers.
The government needs to ensure there is also clear oversight from a regulatory agency. The evidence that was presented by DISER and the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) was that due to the fact that there was no titleholder or operator, the Offshore Petroleum and Greenhouse Gas Storage Act 2006 does not apply. This means that NOPSEMA is unable to issue enforcement actions. This is also contrary to evidence the Treasury presented which suggested 'the bills do not regulate the standards to which decommissioning and remediation activities are to be undertaken. The standards for decommissioning and remediation are regulated by the Offshore Petroleum and Greenhouse Gas Storage Act 2006 and related legislation'.
Mr Gaddes from DISER suggested that 'we enforce those through the contract we have with the provider on the vessel, Upstream Production Solutions. There's no regulatory framework in legislation. We enforce it through the contract'.
While there may be contractual arrangements with the current operator it is concerning that there is no clear process to issue enforcement actions during this decommissioning process given the high-risk work environment and the broader environmental impacts mentioned throughout the report.
Finally, Labor believes there needs to be greater transparency in relation to the amount collected by the levy and reporting in relation to the decommissioning process.
Labor recognises the key role gas plays in creating economic growth and export income earnings for Australia. Labor also recognises the many thousands of jobs the industry creates and sustains.
Labor supports the legislation, but it is important that the government ensures there is proper oversight and transparency of the decommissioning and there is no burden placed on taxpayers.
Recommendation
Labor Senators recommend the government consider amending the bills to give NOPSEMA a legislated duty to provide safety and environmental regulatory oversight over the Laminaria-Corallina decommissioning.
Recommendation
Labor Senators recommend that the government consider amending the bills to include a requirement for the Resources Minister to table in Parliament an annual report on the Laminaria-Corallina decommissioning, including receipts for the levy, progress in decommissioning work, anticipated receipts for the coming year, and a forward work plan.
Senator Anthony ChisholmSenator Jess Walsh
Deputy ChairMember
Labor Senator for QueenslandLabor Senator for Victoria