The Victorian government has approved its first gas extraction project in a decade, near the celebrated tourist site the Twelve Apostles, despite its plans to wean the state’s households off the fossil fuel.
The premier, Jacinta Allan, and the minister for energy and resources, Lily D’Ambrosio, on Thursday announced the approval of Beach Energy’s plan to pipe gas from an offshore field near Port Campbell, in western Victoria, from 30 June.
Allan said the government approved the South Australian company’s plan on the condition it sells the gas to “domestic customers first”.
“This is the first production application that has been approved since 2014 because it’s the only one that has been received by the government since 2014,” she said.
“It reflects the reality that it is a diminishing resource and … whilst it will play a role in our energy transition, it’s not going to play the role that it once did.”
Allan said the government remained on track to reach its target of 95% renewable energy generation and 5% gas peaking power by 2035.
She also said it did not affect plans to transition households away from gas, including through a ban on new gas connections for new dwellings, apartment buildings and residential subdivisions, which came into effect in January.
“We have to take on board the advice of the experts who tell us we need to – where we can – support households and businesses to become all electric,” Allan said.
“It’s a cheaper source of energy but also too it maintains the availability of that diminishing gas resource for those businesses and manufacturers and parts of the power industry that need that ongoing gas supply.”
Beach Energy has had permission to explore for gas in the Otway Basin since May 2019, and it was revealed in 2021 the project received consent from D’Ambrosio to drill beneath the Port Campbell national park.
Its onshore drill site is 450m outside the park but the bore extends 3.5km out into the ocean, including a 1.3km stretch passing underneath the national park.
It is also located about 5km away from the Great Ocean Road and the Twelve Apostles, one of Australia’s most popular tourist attractions. However, it is located outside the Twelve Apostles Marine Park and it has met the government’s environmental requirements.
The Greens acting spokesperson for climate change, Samantha Ratnam, said it was “absolutely outrageous” the government had approved the “disastrous project right near the Twelve Apostles”.
“Labor are choosing to ignore communities and First Nations groups who have blatantly said they don’t want these projects to go ahead,” she said.
Environment Victoria said the project would “pipe gas under the iconic Twelve Apostles, risking one of our environmental drawcards for less than a year’s gas supply”.
“Victoria needs to get off expensive, polluting gas and we don’t do that by drilling new fields. Gas will be responsible for more than a third of Victoria’s greenhouse gas emissions by 2035 if we don’t urgently electrify,” said the non-profit groups’ senior climate and energy adviser, Kat Lucas-Healey.
Friends of the Earth Melbourne said there was “no excuse or need for another gas project in this country”.
The project is expected to produce 160 petajoules over 15 years, which has already been factored into Australian Energy Market Operator forecasts.
D’Ambrosio said this meant the project would not ease the expected shortages caused by dwindling supplies.
She denied the government was sending “mixed messages”.
“The fact is we’re going to continue to need gas for many years to come but our reliance on it will diminish over time because it is depleting,” she said.
Victoria is the country’s largest consumer of gas, with more than 2m households and small businesses using it largely for heating, as well as for hot water and cooking.
Burning gas produces about 16% of the state’s total emissions, with households and small businesses responsible for almost two-thirds of those emissions.
