Source: Australian Financial Review
Controversial frontier exploration planned far off the South Australian coast looks certain to come under even closer scrutiny after the Norwegian oil and gas producer leading the drilling lodged a formal submission for approval just as it beefed up its commitment to align with Paris climate goals.
After engaging with Climate Action 100+, the pressure group of investors that prompted Glencore to commit in February to capping its coal production, Equinor agreed to "stress test" its portfolio against the goals of the Paris accord, including new material capex investments, and to explain how exploration is handled in that context.
The company, known as Statoil until 2018, also pledged to review membership of industry associations to ensure its participation doesn't undermine its support for emissions reductions to limit global warming. The review is understood to include the Australian Petroleum Production & Exploration Association.
The pledges came just as Equinor has applied to Australia's National Offshore Petroleum Safety and Environmental Management Authority for approval to drill the Stromlo-1 exploration well in the Great Australian Bight, an exploit expected to cost more than $100 million that is strongly opposed by environmental groups. Equinor has pursued the project even after former partner BP walked away.
Equinor's 1500-page draft environment plan for the drilling, due to take place by April 2021, attracted more than 31,000 submissions, mostly in opposition. Iron ore billionaire Andrew Forrest is among opponents, as are surfing champions Stephanie Gilmore and Mick Fanning.
The Stromlo-1 well will be drilled 400 kilometres off South Australia at a cost expected to top $100 million. It will target a large oil find that could help arrest Australia's declining self-sufficiency in oil but the plan has raised fears about widespread pollution along the southern coast in the case of a spill.
Equinor's strengthened commitments on climate change are now drawing more attention to the plan from global investors, in addition to environmental groups.
Anne Simpson, a member of the Climate Action 100+ global steering committee and the director of board governance and strategy at huge US pension fund CalPERS, said the fund looks forward "to Equinor setting out their plans for addressing its impact on regional sites to ensure protection of ecologically sensitive areas such as those in Australia".
See the Full article by Angela Macdonald-Smith, AFR Senior Resources Writer