Who needs to pay for newspaper advertising? Not the fossil fuel company Woodside in its home state of Western Australia, based on recent evidence. It can place its message unchallenged in Perth’s local daily without the inconvenience of having to pay for it.
Last Friday the West Australian went big with an opinion piece by Meg O’Neill, Woodside’s Perth-based chief executive – not once, but four times.
The coverage began on page one, with an “exclusive” tag, the headline “Blown out of the water” and a two sentence write-off saying O’Neill had warned that “reams of red tape” were endangering WA’s gas supplies and putting jobs and energy security at risk.
This front-page splash pointed to a longer news story on page four. It explained O’Neill was concerned that laws governing the approval of offshore gas developments were stymieing new developments. She argued those projects were needed “to enable WA’s energy transition” and a failure to fix the laws could lead to a spike in cost-of-living pressures.
The news report quoted no other opinions. It was a summary of O’Neill’s opinion piece, which ran in full on page 50.
It made clear she was specifically focused on Woodside’s $17bn Scarborough gas development, which hit a legal snag last month. The federal court overturned the approval of Woodside’s plan to conduct seismic blasting for Scarborough, agreeing with a judicial review application by Mardudhunera woman Raelene Cooper that argued the offshore petroleum regulator should not have given the company the green light until it had adequately consulted with traditional owners.
The work has been delayed at a cost to the company claimed to be in the tens of millions of dollars. In her piece O’Neill argued that Woodside had consulted extensively, including with 11 First Nations groups, and called on the federal government to work with industry to “fix the logjam of offshore approvals” and “ensure the new gas we all need can be brought to market”.
Senior management at the West Australian agreed. Its fourth piece dedicated to O’Neill’s opinion was an editorial, giving the view of the paper, which said the Woodside boss was correct to suggest WA’s stable gas supply was at risk and urged the government to close a “loophole” that enabled “green activists to co-opt these consultation requirements for their own purposes”.
The paper’s one-sided coverage prompted some sharp commentary from journalists and climate campaigners, publicly and privately. It was seen as consistent with allegations by senior figures in WA that the gas industry has effective “ownership” of the state.
But what of O’Neill’s arguments? They’re worth a closer look.
Would Scarborough gas be for WA homes, schools and hospitals?
Her first major claim was that Woodside was developing Scarborough because “the supply of reliable, affordable and lower-carbon energy had never been more important for WA”, and that included gas “to keep the lights on in our homes, schools and hospitals, and power a local mining industry that will play a critical role on the road to net zero”.
O’Neill didn’t claim that all gas from Scarborough would be used locally – she said the gasfield would supply energy to both “WA and customers in Asia for decades to come” – but the piece implied that Western Australians would be chief beneficiaries.
The reality is a little different. The state has a domestic gas reservation policy that requires 15% to be made available for local use unless otherwise agreed with the government.
In the case of Scarborough, Woodside has a deal with Perdaman Fertilisers to provide the bulk of the domestic supply from the gasfield for use at a urea plant in the Pilbara. It means only 5% of the gas is earmarked for broader uses that might be summarised as keeping the lights on in homes, schools and hospitals. The overwhelming bulk - 85% – will be shipped overseas as liquified natural gas.
Alex Hillman, a former staff adviser at Woodside and now a lead analyst with the Australasian Centre for Corporate Responsibility, says an even smaller proportion of gas from other Woodside developments stays in WA for use locally. “Pluto [gasfield] has provided about 1% of its production to the domestic gas market, with 99% being sent overseas as LNG,” he says.
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Does WA need more gas?
O’Neill argued that WA would need the gas from Scarborough and other new projects to meet a projected shortfall in local supply. She said “while activists are claiming WA needs to get off the gas, the opposite is in fact true”, and government forecasts showed the state needed more gas. “It is gas that will help WA become a renewables superpower,” she said.
The primary forecast O’Neill is referring to is a document called the WA gas statement of opportunities, published by the Australian Energy Market Operator. Designed mainly to inform gas companies and governments considering new investments, the statement of opportunities says demand for the fuel could be up to 5% greater than potential supply this decade, and 16% greater after 2030.
What O’Neill did not mention – and the Aemo report discusses only briefly – is the range of potential solutions to this. Aemo lists options including increasing supply from existing production facilities for a short time and development of gas fields not now included in forecasts.
It also says the state’s big gas users could be “transitioning more rapidly to running on lower-emissions energy sources”. In other words, taking steps to reduce gas use and more rapidly boost renewable energy. This was not the focus of the Aemo report, and O’Neill and the West Australian did not explore it.
What about climate change?
This leads us to the other notable thing about O’Neill’s opinion piece – that it was missing any reference to the climate crisis.
According to Climate Analytics, gas became the largest source of greenhouse gas emissions growth globally last decade. While it will continue to be used for decades, a world energy outlook published by the International Energy Agency this week found the growth era for fossil fuels had finished.
That did not mean an end to investment in oil and gas, but the IEA said it undermined the rationale for increased spending. The agency argued global investment would need to be cut roughly in half by 2030 to put the world on track to reach net zero emissions by mid-century – a stated goal of Woodside and its WA backers.
Government data suggests gas production and use is responsible for about a fifth – 21% – of climate pollution in Australia. Extraction and production of gas from Scarborough and Browse, another potential new field backed by Woodside, would add to this.
It would add far more again to global emissions once the LNG was exported and burned overseas. In the case of Scarborough, estimates of potential lifetime emissions range from 880m tonnes to 1.6bn tonnes of CO2 – more than three times what Australia pumps out in a year.
Hillman’s view is that Woodside’s business strategy “is part of the problem, not part of the solution, as we transition to a low carbon economy.”
This is not a lone view. At the very least, Western Australian media consumers might expect the right to consider it. They might also be told that Seven Group Holdings, the biggest shareholder in the company that owns the West Australian, has a stake in a major gas development in the state.