21 October 2021
Australia’s biggest gas pipeline company, APA, has recently adopted an ambition to reach net zero operational emissions by 2050. It also regularly refers to driving the energy transition to support the Paris climate goals, and a net zero by 2050 outcome.
However, at its annual general meeting today, the company failed to accept that these climate goals require no further expansion of the gas sector. This failure, along with the fact that APA still hasn’t produced any interim emissions targets, calls into question the sincerity of the company’s climate statements.
APA says its “net zero ambition is embedded in APA’s portfolio strategy and capital allocation decision-making, planning and valuation”.
The International Energy Agency (IEA) has confirmed that reaching net zero emissions in the energy sector by 2050, and having a 50% chance of limiting warming to 1.5°C, means there is no room for new gas fields to be developed.
But when APA Chair Michael Fraser was asked to confirm that APA’s commitments mean it will not allocate capital to any projects that facilitate the development of new gas fields, his answer was “no.”
Mr Fraser went on to contradict the IEA’s findings by suggesting that new gas supplies would be required. These comments, as well as Managing Director Rob Wheals’ claim that there is ‘$8 billion worth of market opportunities in gas infrastructure over the next two decades’ were questioned at today’s AGM, with shareholders wanting to know if those statements had been tested against a net zero by 2050 scenario.
Narrabri project opposed by locals, incompatible with climate goals
The most obvious divergence between APA’s gas expansion plans and its claimed support for the Paris climate goals is demonstrated by APA’s proposed Western Slopes Pipeline project, which would facilitate Santos’ destructive Narrabri Gas Project.
The dangers the Narrabri project poses to the climate, groundwater, Gomeroi cultural heritage and farmland make it one of the most heavily opposed proposed fossil fuel projects in the country.
Farmer David Chadwick, whose property would be crossed by the pipeline, spoke of the unanimous local opposition to the project and asked if APA intends to pursue the project and lodge an environmental impact statement. APA failed to walk away from the project, saying it would wait to see how Santos’ plans develop.
The Narrabri gas project is projected to add 5 Mt CO2-e to Australia’s annual emissions, and is clearly incompatible with the IEA’s finding that “No new natural gas fields are needed [in the net zero by 2050 pathway] beyond those already under development.”
This project not only appears to contradict APA’s own climate commitments, but also those of its biggest shareholder, UniSuper, which owns almost 15% of APA’s shares. UniSuper says it will contribute to a 45% reduction in Australia’s emissions by 2030 (meaning national emissions would need to fall by around 24 Mt CO2-e every year), and ensure its portfolio reaches net zero emissions by 2050.
When asked if pursuing projects like Western Slopes Pipeline risks APA losing the support of its biggest shareholder, Mr Fraser commented in very general terms about UniSuper’s support for the company, but failed to address the specific issues of Western Slopes and facilitating new gas field developments.