Bold, brave decisions needed to secure Australia’s ongoing prosperity

As Woodside prepares to mark 70 years as a proud Australian company, it’s clear the energy we’ve produced has made a significant contribution to the nation’s economic prosperity.

This sentiment jumps out of the pages of our archives, which I’ve been looking through in the lead up to our milestone celebration.

Old photos tell the story of a company and a country ready to seize new opportunities.

The collection includes Woodside’s original 1963 exploration permit for the North West Shelf (NWS) and pictures of workers operating without the safety equipment we rightly insist on today.

Reading testimonies from this time, it’s clear the people working on the NWS Project knew they were doing something special.

But not even they could have imagined the enormous contribution the project continues to make to Australia’s prosperity.

This includes 40 years of affordable and reliable energy supply to Western Australia, supporting mines and manufacturing and thousands of cargoes of liquefied natural gas (LNG) sent to Asia.

The project has also seen Woodside and its NWS Joint Venture participants deliver A$40 billion in royalties and excise to the Western Australian Government and the Commonwealth.

This money contributes towards funding vital services in our community like schools and hospitals.

Credit for this contribution is not ours alone, the support of our communities has been critical.

Fast forward and Australia and its communities again face the challenge of securing our future.

But the stakes feel higher, as we deal with the urgent challenge of climate change.

Bold and brave decisions are needed.

From energy producers, customers, government and society.

Woodside is playing its role, constructing the Scarborough Energy Project.

Like the NWS Project before it, economic activity generated by Scarborough is expected to boost Australia’s economy by many billions of dollars.

This includes the payment of an estimated A$19 billion in direct Australian taxes over the project lifecycle.

Scarborough is also creating jobs, with a 3,000 strong construction-phase workforce.

With the first LNG cargo targeted for 2026, the project is expected to supply energy to customers at home and abroad through the energy transition.

I believe our gas has a critical role to play in this transition, by backing up electricity grids powered by renewables and powering the processing of critical minerals needed for batteries and electric vehicles.

It will also be a key ingredient used in fertiliser Australian farmers need to grow our food.

With approximately 0.1% carbon dioxide in the reservoir and a new LNG train at our Pluto facility, Scarborough will provide one of the lowest carbon intensity sources of LNG delivered into north Asia.

We are building Scarborough while working hard to invest in new energy products, like hydrogen and lower-carbon services, including carbon capture and storage.

Just like the development of Australia’s LNG industry in the 1970s and 80s, this involves calculated commercial and technical risk.

Once again, energy producers are considering big investments and looking for locations where the right policy settings are in place.

Consumers want less carbon intensive products but they also want them at a price they can afford.

So how do we find the sweet spot?

We need to work together in the national interest.

Governments must be ready to lead the reforms necessary to drive the next wave of Australian energy projects.

And all stakeholders should discuss the challenges of the energy transition informed by science and facts, rather than ideology and wishful thinking.

It was pleasing to see this point made in the Federal Government’s Future Gas Strategy, which also made it clear that gas will remain an important source of energy through to 2050 and beyond.

The Strategy notes the key role that access to affordable gas will play in Australia achieving its 2050 net zero commitment, and remaining a reliable supplier of energy overseas.

To my mind, the Strategy’s success will depend on translating this important statement of intent into tangible measures that increase gas supply.

These include actions to encourage timely development of existing gas discoveries, providing certainty on offshore exploration acreage releases, and clarifying requirements on stakeholder consultation.

I’m confident that if we can get the policy settings right for gas and new energy, our industry can help deliver a lower-carbon future.

It’s also my firm belief that years from now, when a future Woodside CEO looks at photos of the work we’re doing today, they’ll do so proudly, knowing we contributed to Australia’s ongoing prosperity and the prosperity of the countries where we represent Australia around the world.

(This article was published in The Australian newspaper on Wednesday 19 June 2024.)