Scarborough oil field will be one of Australia's largest fossil fuel development projects in a decade

Last modified on Monday, November 22, 2021 EST 05.49

After obtaining the final approval of the project, the energy giant Woodside will continue to promote the Scarborough natural gas project near the northwest coast of Western Australia.

The USD 16.2 billion Scarborough project is a joint venture between Woodside and BHP Billiton. The announcement issued to the Australian Securities Exchange on Monday afternoon also confirmed that the two companies have agreed to merge their oil operations at a price of USD 40 billion. Become one of the largest fossil fuel companies in the world.

The oil and gas field will become one of Australia's largest fossil fuel projects in the past decade and has been called a "disaster" by environmentalists.

The field is 375 kilometers from the coast of Western Australia and includes 8 wells drilled in the initial stage, 30 of which will be drilled during its life cycle. A 430-kilometer pipeline will connect it to the mainland, and the Pluto LNG processing facility near Karratha will be expanded to cope with the increased capacity, as production is scheduled to start in 2026.

Woodside CEO Meg O'Neill stated that the project will mark a "change" moment for the company and insists it will become a source of low-carbon natural gas.

“The Scarborough Reservoir contains only about 0.1% of carbon dioxide, and Scarborough natural gas processed through the efficient and expanded Pluto LNG facility supports our customers’ decarbonization goals in Asia,” O’Neill said.

"The development of Scarborough brings value to Woodside's shareholders and brings significant long-term benefits locally and nationally, including thousands of jobs in the coming decades, taxes, and natural gas supply for export and domestic markets. "

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BHP Billiton CEO Mike Henry said that the merger will provide value to the shareholders of the resource giant.

"Scarborough will provide global customers with a reliable source of LNG and a safe supply of natural gas for the domestic market, as well as continued employment in Western Australia," he said.

A report issued by the Western Australia Conservation Council and the Australian Institute in June found that the project will release 1.6 billion tons of greenhouse gases during its entire life cycle—the equivalent of 15 coal-fired power plants.

According to the company's carbon reduction plan, Woodside will be allowed to increase greenhouse gas emissions in the next ten years, and then try to reach net zero emissions by 2050.

The development project was strongly opposed by environmental protection organizations such as the Western Australia Conservation Council, which initiated an 11-hour legal action against the project last week.

They say this is the most polluting fossil fuel development project in recent memory. The International Energy Agency said in May that the global heating temperature is limited to 1.5 degrees Celsius, which is the goal set in the Paris agreement, which means that exploration and development of new fossil fuel basins must be stopped this year.

David Ritter, chief executive officer of Greenpeace Australia Pacific, said Woodside was "defying Australians" by continuing to advance the project. "Public anger against the Woodside project-threats to whales, the marine environment, Western Australia's coastline and climate-will continue to grow," Ritter said.

"As long as the company sticks to this route, Woodside's company name will become synonymous with destroying everything that Australians hold dear."

Dan Gocher, director of climate and environment at the Australian Centre for Corporate Responsibility, described the company's decision as a "desperate" attempt to escape financial difficulties.

"Woodside doesn't seem to care about climate. It didn't talk about climate or emissions when it was released," Gocher said. "To be honest, this is a total disaster."