Second Setback for Equinor’s Australian Drilling Plans

Credit: Great Australian Bight Alliance
Credit: Great Australian Bight Alliance

Published Nov 11, 2019 5:34 PM by The Maritime Executive

For the second time, Australia’s offshore oil and gas authority NOPSEMA has rejected Norwegian oil-giant Equinor’s proposal to drill for oil in the Great Australian Bight.

NOPSEMA issued a notice to Equinor requiring it to modify and resubmit its environment plan. Equinor must provide NOPSEMA with further information about matters relating to consultation, source control and oil spill risk. “The opportunity to modify and resubmit does not represent a refusal or rejection of the environment plan,” says NOPSEMA. NOPSEMA is required by law to provide titleholders a reasonable opportunity to modify and resubmit their plan if it doesn’t meet the regulatory requirements for acceptance.

Research undertaken by The Australia Institute research which was released this week indicates that South Australia stands to gain just one tenth of one percent of total state revenues from the project over its 40 year lifetime. Modelling based on industry projections of basin wide oil reserves shows the Norwegian Government would receive estimated profits (in net present terms) of A$8.1 billion if Equinor were to develop the base case scenario. The South Australian Government would receive just A$0.3 billion and the Australian Government would receive A$7.4 billion.

“We know that this project doesn’t make sense economically for South Australia, and it’s becoming increasingly clear that the environmental case doesn’t stack up either,” said Noah Schultz-Byard, Director of The Australia Institute, South Australia. “We already know that 60 percent of Australians and 68 percent of South Australians are opposed to opening up the Bight for oil drilling.

“Australia Institute research demonstrates more than 10,000 South Australian jobs in coastal tourism, fisheries and aquaculture rely on the Bight and our healthy oceans to survive. A significant oil spill in the Great Australian Bight would be a disaster for the South Australian economy.”

As a member of the Great Australian Bight Alliance, Sea Shepherd Australia is calling on Equinor to withdraw its bid. According to Equinor’s reporting, an oil spill in the Great Australian Bight could affect the coastline from South Australia to as far north as Port Macquarie in New South Wales. 

Sea Shepherd Australia’s Managing Director Jeff Hansen said, “We encourage Equinor to stand on the right side of history with the Great Australian Bight Alliance, the communities, the councils opposing drilling in the Bight as well as the school children globally striking for action on climate. It’s time that Equinor stopped playing games with our Bight and children’s future and joined BP and Chevron by ceasing their plans to drill for oil in our Great Australian Bight.”

Let’s not forget that BP’s 2010 Gulf of Mexico disaster occurred during exploratory drilling and took almost 7,000 boats in the attempted cleanup, says Hansen. “The Great Australian Bight is a pristine natural wilderness area, home to one of the world’s most significant southern right whale nurseries. Spill modelling shows that their nursery would not be safe from a toxic fallout from Equinor’s proposed risky deep-sea oil drilling.”

Equinor has 21 days to respond to NOPSEMA’s request to modify and resubmit its environment plan. However, the company may request an extension to this timeline.