The Australian Energy Producers, which represents the country’s upstream oil and gas exploration and production industry, has called on the Commonwealth to fix the offshore regulatory system, which it claims is broken. The industry group’s call comes after a logjam of energy supply and carbon capture projects awaiting approval was exposed. According to the Australian Energy Producers, the average wait times were generally around 180 days before the offshore regulatory approval “chaos.” However, plans have been tangled up in the approvals process for 562 days on average for exploration and 400 days on average for development as a result of regulatory uncertainty, following a Federal Court ruling last year.

Samantha McCulloch, the Chief Executive of the Australian Energy Producers, has urged the Commonwealth to fast-track its review of offshore environmental regulations. She commented that the regulator has revealed the uncertainty and ambiguity of the regulations that are risking the energy security of Australia and its international trade partners. Projects that will provide reliable and affordable energy to Australian households and businesses have been held up for an average of 562 days, which is a huge blowout. A number of plans have been in the approval process for more than two years. Even if projects are approved, uncertainty remains. An approval no longer means an approval, and companies are watching approvals granted by the national regulator be overturned in court.

Additionally, according to the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA), 42 environmental plans linked to energy and carbon capture projects worth billions of dollars were submitted before the court’s decision, but only five have been approved since then. Officials attribute the delay to “complexities” arising from the regulations and the court’s interpretation.

McCulloch emphasized the need for governments to ensure robust and timely approvals to avoid shortages and upward pressure on energy prices. He also called for regulations that provide clarity and certainty for the industry while maintaining comprehensive and meaningful consultation with stakeholders.

Australia, like many other countries, sees gas as a solution to the double whammy of energy security and sustainability. The Australian government’s Future Gas Strategy consultation paper highlights the urgent need for investment in new gas supply to avoid future shortfalls and underpin the net-zero transition in Australia and the region.

The paper also reveals a new analysis, which shows that future gas demand will outstrip supply in the East and West Coast gas markets in 2034 and 2032, respectively. The Australian Energy Producers’ Chief Executive noted that the paper recognized the growing role of gas not only as a partner to renewables in electricity but also as a feedstock to Australian manufacturing and industry. The paper also acknowledged the need for carbon capture, utilization, and storage (CCUS) technology, and the importance of gas exports to Australia and the region.