speech AOG conference opening session: thoughts on the 'evolving industry'

Wednesday 10 March 2021
AOG Conference Opening Session - Thoughts on the 'Evolving Industry'

Our business is essential. It is also very competitive. This past year, industry, government, the people who work for us put aside the drivers of economics and looked at the needs of society and the needs that were driving a world caught up in a very difficult pandemic. We worked against global forces and met the challenge to provide energy.

In 2018-2019 around 60 percent of Western Australia’s energy came from natural gas supply - you can imagine what the past 12 months would have been like without electricity to power the needs of our community. We also have to recognise our global competitors aren’t resting. We face competition from lower-priced destinations, and Australia’s crown as the world’s biggest LNG producer could be short-lived. We want to rise to meet those challenges.

In any environment, we must continue to learn, adapt our methods to be as efficient and reliable as possible and take advantage of technologies that are going to benefit this industry and benefit the world. We always have to be willing to change the way we work.

In a difficult time and in challenging conditions, our industry, government and the people of Western Australia came together recognising the importance of what we do and how critical it is to infrastructure, households, jobs and the reliable supply of gas to the state and other markets across Asia.

Through meaningful collaboration, we are building a stronger industry and a more prosperous state based on technology, innovation, and skills development. We are maximising local opportunities - opportunities that became more apparent in a COVID world. There were key initiatives and achievements of the LNG Jobs Taskforce that have allowed us to deliver tangible, win-win opportunities for community and businesses that operate here.

The LNG Futures Facility, a world-first microscale LNG plant, will promote our credentials as a global LNG service hub via testing of new technologies by operating companies, service providers and experts in a low-risk live operating environment.

The Forward Work Plans being presented here at AOG provide a two-year outlook and improve planning of potential contracting activity and supply chain capabilities for WA resource companies. They provide a way for us to work together to be in the right place at right time.

Standardising local content reporting will provide great leverage for local businesses. It is another practical ambition of the Taskforce, together with an aligned LNG skills framework for operators that will build local capabilities so we can react to global market conditions and link people with technologies that will make our businesses better.

An emerging part of our business is the Centre of Decommissioning Australia. It’s a new industry and government partnership spearheading national decommissioning efforts to drive positive asset retirement results and deliver long-term environmental and socio-economic outcomes. It’s going to be practical, meeting the needs of the community in balance with the needs of industry.

We are harnessing our learnings and applying technology with digital innovation being at the heart of our business as we become more efficient and reliable in the post-COVID-19 economic recovery.

Border restrictions were challenging. They happened quickly and put pressure on individuals and families as they had to make significant transitions. But in that time of great challenge, we were able to look locally to find talents and skills to undertake work on our critical assets that, in the past, we would have reached out for internationally. We found appliable and transferable skill sets to address rotating equipment needs and fixed equipment challenges. And we brought skilled tradespersons from Western Australia to our sites, allowing them to further broaden their skills and work experience.

We were able to take advantage of digital opportunities we weren’t using before COVID. Living rooms and kitchens became the work office and seeing children and pets brought us closer to where people lived and the humanity around us.

We also connected people in unique ways on our working assets. For our Wheatstone Platform, we designed and deployed a digital twin of that asset, reducing the number of engineers and other technical personnel who needed to travel there to perform their work. This reduced their potential exposure to COVID while allowing them to do their work in real time. What once required a visit to the platform was now able to be performed from their home. An exciting innovation brought on by the pandemic.

In an Australian-first and cutting-edge in the world, the Jansz-Io Compression Project will use subsea compression to enhance recovery of the Jansz-Io field to maintain long-term gas supply to the LNG and domestic gas plants on Barrow Island.

And it’s got momentum! We are through Front End Engineering and Design and expect a Final Investment Decision sometime this year. We’ve completed the necessary technical work to be sure we’ve got the right concept, design and technology to meet future demands. Reliability is going to be core to this operating asset.

Similarly, on Gorgon Stage 2, I’m pleased to report the pipeline installation campaign is progressing safely and to schedule. That’s amazing in a world that’s been challenged throughout last year. It’s already generated 800-plus local jobs through drilling and completion activities, subsea infrastructure installation and local project management.

The benefits from these growth projects come on top of ongoing operations spend. On Gorgon, cumulative local content operations spending is more than 90 percent, with more than 90 percent of that being in Western Australia. We’re excited to continue building on Gorgon’s unrivalled legacy of innovation and economic contribution and supporting the ongoing growth of Western Australia’s LNG sector.

We are also acting and using unique capabilities, assets and expertise to reduce the carbon intensity of natural gas - a tremendous challenge and opportunity to advance the global ambitions of the Paris Agreement and our lower carbon goals.

Gorgon’s emissions reduction system is demonstrating the vital role carbon capture sequestration is going to play. Since safely starting the system, more than four million tonnes of greenhouse gas emissions have been mitigated. And recent data shows a 30 percent reduction in Gorgon’s emissions on the previous reporting period. That’s the equivalent of taking approximately one million passenger vehicles off our roads for a year.

Lower carbon and energy efficiency improvements are integral to how we run our business. At Wheatstone, we’ve achieved a reduction of more than 200,000 tonnes of GHG emissions in the last year.

Our path to our lower carbon future is a shared one to enable new technologies to be developed at scale, tested and continually improved on so they can become economically viable. Harnessing and sharing our learnings will only support the increased deployment and cost effectiveness of lower emissions technology in Australia and globally. 

None of the things I’ve talked about this morning would be possible without our most valuable asset - our people. I’ve watched the impact COVID has had in their lives. I’ve seen people spend extended time away from family. I’ve seen the challenges they have faced as their families have been impacted by this, and yet they have stayed committed to delivering – safely - domestic gas locally and LNG to our markets in Asia. They come to work every day and make great sacrifices - we appreciate them greatly and recognise they are the core of what we do.

While 2020 was an extremely challenging year, people were front of mind for us through our COVID-19 response. We went to great efforts to do what we could to make their transitions as easy as possible while reducing the impacts on their families and the communities in which they live.

We continue to strive to be a valued partner – with government, communities, our joint venture partners and customers, and we’re proud to be playing a key role. As we saw recently with the bushfires in Western Australia, industry and community came together again to deal with huge challenges and try to benefit the lives of people impacted by that devastation.

We’re looking forward to the generations to come and think we have a good sight of the future, including ways to advance the technologies we have more quickly than previously thought towards a world where energy is delivered in a lower carbon way.

And, from what I’ve learned from 2020, we do difficult. Collectively, we’re committed to working with governments and the community – our industry will continue to rise to the challenge.

Thank you.