Court challenge for Woodside's $20b Scarborough project

Doctors for the Environment Australia (DEA) has gone to the Federal Court seeking to overturn the final approval for Woodside's Scarborough gas project, citing concerns about its resultant greenhouse gas emissions.

The offshore environment regulator NOPSEMA accepted Woodside's plan to operate the Scarborough project in February after 18 months of consultation.

The action launched on Wednesday by the DEA, which has 2000 doctors and medical students as members, sees a judicial review of NOPSEMA's decision.

Is gas good or bad?

DEA executive director Dr Kate Wylie said NOPSEMA may have acted unlawfully by accepting the environment plan without fully understanding how the impacts of the $US12.5 billion ($19.6 billion) project would be managed.

Australia's gas exporters argue their product is good for the climate as it lowers overall emissions by displacing coal and supporting renewable energy, but environmental groups dispute this.

“Woodside acknowledges that there is uncertainty about whether gas from the Scarborough project will displace even dirtier fuels," Wylie said in a statement.

In April, Woodside chief executive Meg O’Neill was given an opportunity to sell the role of Australian gas exports in cutting emissions in Asia when she was asked: "in terms of the coal-to-gas switching story in Asia, do you have any comfort or any insights from counterparties or from the market to show that gas going into Asia is replacing coal, or to what extent is it additional energy and additional emissions."

O'Neil answered: “Trying to definitively prove that our cargo of LNG displaced coal that would have otherwise been burned is a very difficult strategy.”

In 2019, a Woodside-commissioned CSIRO report analysed the complex interactions within Asian energy markets to determine the effect of importing Australian gas, but the company did not release it.

Woodside eventually published the report in 2022 after inquiries from the Nine mastheads, which summarised its findings as “Increasing Australian gas supply could prolong coal, displace renewables, and increase emissions in Asia without a global carbon price.”

There is no global carbon price.

David and Goliath

Wylie told Boiling Cold her organisation, as doctors, believed we need a healthy environment for human health.

She said NOPSEMA accepted the DEA as a"relevant person" to be consulted ahead ot its decision, and that gives it the legal standing to seek a judicial review.

"We're a registered charity taking on one of Australia's most profitable companies, so this is a David and Goliath battle," she said.

"This is not a decision we've taken lightly, but we feel compelled to do what we can to protect human health from climate change."

Wylie, who continues to practise as a GP in South Australia, said the DEA will seek a protective cost order to cap its liability to pay its opponents' costs if they lose.

The non-profit law firm Environmental Defenders Office (EDO), which represents the DEA, was ordered to pay Santos $9 million in costs after the judge in its case against the Barossa gas project found it had subtly coached witnesses and used an expert witness whose testimony was a "confection."

Wylie said its challenge to the final approval for Scarborough was in the public interest.

"The Scarborough gas project is set to unleash approximately 878 million tons of carbon dioxide over its lifetime," she said.

"This is a significant source of carbon dioxide amid an already deteriorating climate,

"The science tells us that there can be no new sources of carbon if we are to pursue Paris Agreement ambitions to limit global warming to 1.5 degrees and limit warming to below two degrees,

"It is in the public interest that the regulator's assessment of impacts in the final approval for this polluting project be reviewed by the courts."

A Woodside spokesman said its operations environment plan was assessed in accordance with the law and it will defend its position in the proceedings.

"Woodside looks forward to a swift resolution," he said.

"The Scarborough Energy Project is generating thousands of jobs throughout the construction phase, has committed more than $3.6 billion in spend in Western Australia and is expected to pay more than $50 billion in direct and indirect taxes."

Woodside has completed 82 per cent of the work on Scarborough and plans to start exporting gas in the second half of 2026.

A NOPSEMA spokeswoman said the regulator was aware the EDO had filed judicial review proceedings in the Victorian Registry of the Federal Court regarding its decision to accept Woodside's Scarborough operations environment plan.

She said the decision and a statement of reasons were publicly available, and it was not appropriate to comment on court proceedings.

UPDATE 2 May 2024 12:20PM: NOPSEMA comments added.