Terms defined in Acts or international agreements are italicised.
Purpose and structure of the Bill
The Environment Protection (Sea Dumping) Amendment (Using New Technologies to Fight Climate Change) Bill 2023 (Sea Dumping Bill) proposes to amend the Environment Protection (Sea Dumping) Act 1981 (Sea Dumping Act) to give effect to Australia’s international obligations under 2009 and 2013 amendments to the London Protocol.
The Bill has 1 Schedule with 2 Parts:
- Part 1 would amend the Sea Dumping Act to allow the Minister for the Environment to issue an export permit for a controlled material, being a carbon dioxide stream from carbon dioxide capture processes for sequestration into a sub-seabed geological formation, in specified circumstances.
- Part 2 would amend the Sea Dumping Act to allow the Minister for the Environment to issue a permit for the placement of wastes or other matter for a marine geoengineering activity as permitted by the London Protocol (currently, ocean fertilisation for legitimate scientific research). It would also make a range of consequential and technical amendments, including to offence and enforcement provisions.
The release of greenhouse gases (including carbon dioxide (CO2) and methane (CH4)), from human activities, such as the burning of fossil fuels, are acknowledged to be contributing to climate change. The Paris Agreement commits the global community to reducing greenhouse gas emissions so as to hold ‘the increase in the global average temperature to well below 2˚C above pre-industrial levels’ and pursue ‘efforts to limit the temperature increase to 1.5˚C above pre‑industrial levels’. In addition to urgent actions to limit the release of greenhouse gases, this will require the rapid and extensive deployment of mitigation options, including low-emissions technologies.
Two of these technologies are sub-seabed sequestration of carbon dioxide streams (more commonly referred to as carbon capture and storage) and marine geoengineering. Both of these activities fall within the broad scope of the London Protocol and specific amendments in 2009 and 2013 have sought to provide an international regulatory framework to protect the marine environment from the impacts of these activities.
The International Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matter (London Convention) was one of the first international conventions to protect the marine environment from human activities. The Convention came into force in 1975 and there are currently 87 State Parties. Its objective is ‘to promote the effective control of all sources of marine pollution and to take all practical steps to prevent pollution of the sea by the dumping of wastes and other matter’.
In 1996, State Parties to the London Convention agreed to the 1996 Protocol to the Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matter of 29 December 1972 (London Protocol). The London Protocol came into force on 24 March 2006. There are currently 53 State Parties to the Protocol. Importantly, the London Protocol supersedes the London Convention for parties to both.
The London Protocol aims to modernize (and eventually replace) the Convention, principally by integrating a precautionary approach. Under the London Protocol all forms of dumping at sea are prohibited, except for possibly acceptable wastes identified in Annex 1 of the Protocol (the ‘reverse list’). These wastes or other matter may be considered for dumping but would require a permit from the relevant designated national authority. The ‘reverse list’ in Annex 1 includes:
- dredged material
- fish wastes, or material from industrial fish processing operations
- vessels and platforms, or other man-made structures at sea
- inert, inorganic geological material (for example, mining waste)
- organic material of natural origin
- bulky items primarily comprising iron, steel and concrete (from small islands with isolated communities and limited opportunities for other disposal)
- carbon dioxide streams from carbon dioxide capture processes for sequestration.
Amendments to the London Protocol
Export amendments: sub-seabed geological sequestration of carbon dioxide streams
In 2006, an amendment to Annex 1 of the London Protocol added ‘carbon dioxide streams from carbon dioxide capture processes for sequestration’ to the list of wastes or other matter that may be considered for dumping.
The preamble to the amendment notes ‘that carbon dioxide capture and sequestration is one of a portfolio of options to reduce levels of atmospheric carbon dioxide’, while recognising that carbon dioxide capture and sequestration should not be considered as a substitute to other measures to reduce carbon dioxide emissions’.
What is sub-seabed sequestration of carbon dioxide streams and how might it mitigate climate change impacts?
The origins of carbon capture and storage lie in enhanced oil recovery (EOR), which has been used in the oil and gas industry since the 1970s.
The Intergovernmental Panel on Climate Change (IPCC) observed in its 2005 Special Report on Carbon Capture and Storage that:
CCS has the potential to reduce overall mitigation costs and increase flexibility in achieving greenhouse as emissions reductions. The widespread application of CCS would depend on technical maturity, costs, overall potential, diffusion and transfer of technology to developing countries and their capacity to apply the technology, regulatory aspects, environmental issues and public perception.
Relevant to the 2009 amendment, sub-seabed geological sequestration of carbon dioxide streams would involve:
- the capture of anthropogenic CO2 generated from the burning of fossil fuels and other industrial processes at a stationary source (for example, point of processing)
- transport of CO2 via ship and/or pipeline to a storage location
- injection and storage of the CO2 into a suitable sub-seabed geological formation for permanent storage; and
- monitoring, mitigation and verification.
According to the Global CCS Institute, there are 30 operational CCS projects worldwide (less than one third of these involve dedicated geological storage). However, the implementation of dedicated storage projects at scale has proved challenging. For example, Chevron’s Gorgon CCS project on Barrow Island, Western Australia, has faced consistent challenges resulting in a failure to sequester the required reservoir CO2 generated by the Gorgon LNG project.
In 2022, the IPCC observed ‘the high cost of the capture and storage process not only limit the technology penetration, but also make energy and products more expensive’. The IPCC also noted the potential risk of leaks from undersea or underground CO2 storage, while there is a further risk of the potential ‘lock-in of existing energy structures [that is, continued extraction of fossil fuels] due to CCS’.
Therefore, while CCS is one of a suite of options available for reducing CO2 emissions, particularly in hard-to-abate sectors, it is not a substitute for decarbonisation of the global economy.
In 2009, an amendment to Article 6 of the London Protocol sought to overcome a prohibition in that Article on the export of wastes or other matter to other countries for dumping. The amendment provided that the export would be conditional on an agreement or arrangement being entered into by the countries concerned, and would require:
- confirmation and allocation of permitting responsibilities between the exporting and receiving countries, consistent with the provisions of the Protocol and other applicable international law
- if the other country was a non-Contracting Party, provisions at a minimum equivalent to those contained in the Protocol
- notification of agreement or arrangement to the IMO.
Contracting Parties have approved a range of guidance documents to support Contracting Parties in their implementation of the Protocol generally and in relation to the implementation of the 2009 amendment. These include:
Relevantly, the Guidance on implementation of Article 6.2 states an agreement or arrangement entered into between two Parties for the export of wastes or other matter from one country to another for dumping could comprise a memorandum of agreement or a treaty, or a non-binding memorandum of understanding respectively.
Amendments to the London Protocol only come into force if two-thirds of the Contracting Parties have deposited an instrument of acceptance of the amendment. At the time of writing, only 10 Contracting Parties have ratified the 2009 amendment. The Australian Government has indicated an intention to do so.
At the time of writing, 7 of the 10 Contracting Parties to the Protocol have ratified the 2009 amendment have agreed to a ‘provisional application’ of the 2009 amendment, allowing the Contracting Parties to make use of the amendment before it formally enters into force. Those Parties are also required to have appropriate domestic legislation and deposit an instrument of ratification with the IMO. This ‘provisional application’ is consistent with Article 25 of the Vienna Convention on the Law of Treaties, and would enliven the Commonwealth’s external affairs power.
Marine geoengineering and ocean fertilisation
In 2013, an amendment to the London Protocol amended Article 1 and inserted 3 new articles or annexes: Article 6bis, Annex 4 and Annex 5. The amendment allows for the placement of matter into the sea for the purpose of legitimate scientific research into marine geoengineering activities (such as ocean fertilisation).
What is marine geoengineering and how might it mitigate climate change impacts?
The oceans play a central role in regulating the Earth’s climate, serving as a major heat and carbon sink. At the same time, climate change impacts on the oceans include temperature rise, ocean acidification, sea level rise and the expansion of oxygen minimum zones, with consequent impacts on ecosystems services such as the provision of livelihoods and foods.
However, over recent decades scientists have proposed a range of activities in the marine environment to:
- remove carbon dioxide from the atmosphere (CDR)
- reduce the amount of solar energy that is absorbed by the Earth’s surface (SRM).
These are collectively referred to as geoengineering: ‘the deliberate large-scale manipulation of the planetary environment to counteract anthropogenic climate change’.
However, many of the proposed methods have not moved beyond theoretical modelling and studies highlight significant knowledge gaps in understanding of climate and ecological system interactions and impacts. Ocean fertilisation is one the earliest proposed carbon-removal technologies. It would involve the direct or indirect addition of iron or other nutrients to surface waters with the intention of enhancing microscopic marine plant growth, on a scale large enough to significantly increase the uptake of atmospheric carbon by the ocean and to remove it from the atmosphere for long enough to provide a global climate benefit.
In October 2022, the Contracting Parties to the London Convention and London Protocol identified four techniques for priority evaluation:
- enhancing ocean alkalinity
- macroalgae cultivation and other biomass for sequestration, including artificial upwelling
- marine cloud brightening
- microbubbles/reflective particles/material.
The US National Academies of Science, Engineering, and Medicine recently observed ‘it is critical that [marine geoengineering] approaches be assessed against the consequences of no action and as one component of a broad and integrated climate mitigation strategy’.
The 2013 amendment was proposed by Australia and co-sponsored by Nigeria and the Republic of Korea, on the premise that ocean fertilisation should only occur for legitimate scientific research purposes and should otherwise be prohibited. The then Minister for Sustainability, Environment, Water, Population and Communities, Tony Burke, said:
The potential impacts of ocean fertilisation could be severe and may include ocean acidification, harmful algal blooms, oxygen depletion in deep waters, or other unwanted ecosystem changes and human health consequences.
As outlined in the Preamble to the 2013 amendment, Australia’s proposal followed a series of resolutions by the United Nations General Assembly and other intergovernmental bodies about the potential environmental impacts of ocean fertilisation. For example, in its 2008 Decision, the Conference of the Parties to the Convention on Biological Diversity noted the ‘absence of reliable data covering all relevant aspects of ocean fertilization, without which there is an inadequate basis on which to assess their potential risks’. It requested Parties and other Governments to:
ensure that ocean fertilization activities do not take place until there is an adequate scientific basis on which to justify such activities, including assessing associated risks, and a global, transparent and effective control and regulatory mechanism is in place for these activities; with the exception of small scale scientific research studies within coastal waters.
The 2013 amendment to Article 1 defines marine geoengineering as:
A deliberate intervention in the marine environment to manipulate natural processes, including to counteract anthropogenic climate change and/or its impacts, and that has the potential to result in deleterious effects, especially where those effects may be widespread, long lasting and severe.
The amendment prohibits the placement of matter into the sea for marine geoengineering activities as listed in the new Annex 4 unless the listing in Annex 4 also specifies that the activity may be undertaken in accordance with a permit. The new Annex 5 sets out an assessment framework for matters that may be considered for placement under Annex 4.
Annex 4 only specifies one activity, ocean fertilization, and provides that the activity ‘may only be considered for a permit if it is assessed as constituting legitimate scientific research taking into account any specified placement assessment framework’. The Assessment Framework for Scientific Research involving Ocean Fertilization was agreed in 2010 and aims to assist regulators to assess whether proposals for ocean fertilization constitute legitimate scientific research.
At the time of writing, only six Contracting Parties have notified the IMO of their acceptance of the amendments.
Application of the 2009 and 2013 amendments for Australia
In order for the 2009 amendment to apply in Australia, the Australian Government would need to:
- make appropriate amendments to the Sea Dumping Act (as proposed by the Bill)
- deposit an instrument of ratification of the 2009 amendment with the IMO and
- deposit a declaration of the provisional application of the 2009 amendment with the IMO.
The provisional application would then commence and Australia could enter into an agreement with another Contracting Party, or a non-contracting party, for the export of carbon dioxide streams for sub-seabed sequestration.
In order for the 2013 amendment to apply in Australia, the Australian Government would need to:
- make appropriate amendments to the Sea Dumping Act and
- deposit an instrument of ratification of the 2013 amendment with the IMO.
The 2013 amendment would not however commence until such time as the 2013 amendment comes into force generally and for Australia (following ratification by two-thirds of Contracting Parties).
Australian regulatory framework for sea dumping and greenhouse gas activities
Regulation of sea dumping
Australia implements its obligations under the London Protocol via the Environment Protection (Sea Dumping) Act 1981 (Sea Dumping Act). The Act:
Regulates [through permits] the loading, dumping and incineration of waste at seas and the placement of artificial reefs within Australian waters. It also prohibits the ocean disposal of material considered too harmful to be released into the marine environment and regulates permitted ocean waste disposal to minimise its potential harmful environmental impacts.
The Act is administered by DCCEEW and the Minister for the Environment and Water is the responsible Minister.
The Act applies generally in Australian waters, including coastal waters. However, the Act contains special provisions relating to specified maritime boundary regions, including waters that are subject to the Torres Strait Treaty (the ‘Top Hat’), the Australian-Indonesia Delimitation Treaty and the Greater Sunrise special regime area.
The Act includes provision for the Minister to require actions to be taken to repair or remedy, or mitigate any damage, arising from the dumping or incineration of controlled material in Australian waters. It also provides that, if a person has been convicted of a relevant offence, the Commonwealth may recover its costs of implementing actions to repair or remedy, or mitigate any damage arising from the commission of the offence.
Regulation of greenhouse gas activities
Greenhouse gas activities, including assessments and injection and storage activities, are regulated by the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (OPGGS Act) and associated regulations. The Act is administered by the Department of Industry, Science and Resources (DISR), and the Minister for Resources is the responsible Minister.
The OPGGS Act allows for the grant of greenhouse gas titles, covering exploration and assessment of potential greenhouse gas storage formations and injection sites, greenhouse gas holding leases, and greenhouse gas injection licences. The responsible Commonwealth Minister must approve key greenhouse gas operations. An approved site plan must also be in place before greenhouse gas injection activities can take place. The approval process covers the lifecycle of projects, including decommissioning and post-closure monitoring activities.
A number of other entities are responsible for specific matters under the Act, including:
- Cross-boundary Authorities, comprising the responsible Commonwealth Minister and a responsible state or Northern Territory Minister and which may be established to make certain decisions in relation to the grant of greenhouse gas titles and conditions thereto
- the National Offshore Petroleum Titles Administrator, a branch of DISR headed by the Titles Administrator, which administers offshore greenhouse gas storage titles in Commonwealth waters
- the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA), which regulates health and safety, structural (well) integrity and environmental management for offshore petroleum and greenhouse gas storage activities in Commonwealth waters, and in coastal waters where regulatory powers and functions have been conferred by the relevant state or Northern Territory. NOPSEMA assesses and approves environment plans relating to petroleum and greenhouse gas activities, including sub-seabed sequestration of carbon dioxide (noting an approval may also be required under the EPBC Act (see below)).
The Australian Government first released greenhouse storage acreage for bidding in 2014. The DISR provides an overview of the acreage release process. At the time of writing, there are six active greenhouse gas assessment permits, 1 each in the Bonaparte, Browse and Gippsland Basins and 3 in the Northern Carnarvon Basin. On 19 May 2023, the Government released information on 10 potential areas for inclusion in the 2023 offshore greenhouse gas storage acreage release. Submissions to the House and Senate inquiries indicate the interest of the oil and gas industry in developing these titles.
Environmental assessment and approval for actions with a significant impact on matters of national environmental significance
The Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act) establishes a regime for the assessment and approval of actions that are likely to, have or may have a significant impact on a matter of national environmental significance (MNES). Those matters include the Commonwealth marine area, threatened species and ecological communities, and national and World Heritage places.
While the grant of a governmental authorisation (such as a greenhouse gas storage title) under the OPGGS Act is not an action for the purposes of the EPBC Act, greenhouse gas injection and storage activities may need to be referred for assessment and approval under the EPBC Act. This is because, in contrast to petroleum activities, these activities are specifically excluded from the ‘class of actions’ included in the grant of approval of NOPSEMA’s environmental management authorisation process under Part 10 of the EPBC Act (providing for strategic assessments). That approval allows NOPSEMA to assess and approve petroleum activities that are likely to, have or may have a significant impact on a MNES without the need for any further approval from the Minister for the Environment under the EPBC Act.
Marine geoengineering activities, including ocean fertilisation, may also need to be referred for assessment and approval under the EPBC Act and, depending on their location, other relevant Commonwealth and state or NT legislation.
Generation of carbon credits for CCS activities
The Clean Energy Regulator (CER) administers several Commonwealth laws and associated instruments for measuring, managing, reducing or offsetting Australia’s carbon emissions, including the Emissions Reduction Fund.
Since September 2021, under the Carbon Capture and Storage Methodology Determination it has been possible for eligible projects to generate Australian Carbon Credit Units (ACCUs) from an activity that captures greenhouse gases that would have been released to the atmosphere and transports them for injection into underground geological formations for permanent storage. At the time of writing, only 1 project has been registered, the Moomba Carbon Capture and Storage Project, an onshore geological storage project in South Australia.
Why export carbon dioxide streams?
An explanation of why the Bill makes provision for export of carbon dioxide streams lies in the plan of a major Australian gas producer to establish a carbon capture and storage project that traverses the maritime boundaries of Australia and Timor-Leste.
The Bayu-Undan gas field is located approximately 500 km north-west of Darwin in an area now within the jurisdiction of Timor-Leste. The field is operated by Santos and gas from the field is processed and stored at the field via processing facilities and a Floating Production Storage and Offloading (FPSO) vessel and then exported along a 502 kilometre (km) subsea pipeline to the onshore Darwin LNG project at Wickham Point, south-east of Darwin. Production from the Bayu-Undan gas field is expected to cease in early-mid 2023; however, Santos submitted and then withdrew a proposal to decommission most of the export pipeline in mid-2020.
In September 2021, Santos announced that it had signed a Memorandum of Understanding with the Timor-Leste regulator Autoridade Nacional do Petróleo e Minerais (ANPM) to progress CCS opportunities at the Bayu-Undan site. The proposal would involve the repurposing of the existing Bayu-Undan facilities (delaying decommissioning liabilities) and using the Bayu-Undan reservoir for CCS, with carbon dioxide streams to be captured at other gas fields in Australia’s offshore area (such as the Barossa gas field) and imported from other countries for injection into the Bayu-Undan field for permanent storage.
Santos managing director and CEO Kevin Gallagher said:
CCS at Bayu-Undan has potential capacity to safely and permanently store approximately 10 million tonnes per annum of CO2 and could build a new job-creating and revenue-generating industry for Timor-Leste.
In March 2022, Santos announced that the proposed Bayu-Undan CCS project had entered the ‘front-end engineering and design (FEED) phase’ with the support of five joint venture partners. Santos’ announcement specially notes that ‘the project will also need agreements between the governments of Timor-Leste and Australia, and some Australian regulatory arrangements’.
The proposed Bayu-Undan CCS project is intended to serve as a ‘regional carbon reduction project’. In May 2023, Santos announced the execution of four Memoranda of Understanding with ‘potential upstream gas and LNG projects offshore the Northern Territory and in Darwin, and an energy and industrial conglomerate in Korea’. Mr Gallagher is quoted as saying ‘we will continue to work with the Timor-Leste and Australian governments to urgently progress the necessary regulatory and fiscal frameworks and approvals required to support the development of Bayu-Undan CCS’. A final investment decision is targeted for 2025.
Australian Government support
In February 2022, during a meeting with his Timor-Leste counterpart, the then Prime Minister, Scott Morrison, ‘committed to establish an LNG Partnership Fund to deepen links between Australia and Timor-Leste in gas development and trade, including in the use of carbon capture and storage’.
In a speech during her July 2023 visit to Timor-Leste, the Minister for Foreign Affairs Senator Penny Wong specifically referenced the introduction of the Sea Dumping Amendment Bill as indicative of the Australian Government’s support of Timor-Leste’s economic resilience through its desire to develop the Bayu-Undan CCS Project.
Media reporting suggest plans for the receipt of carbon dioxide streams from Singapore, Korea and Japan. Australia has already entered into low emissions partnership agreements with the republic of Korea, Japan and Singapore, which includes cooperation on CCS.
The Australian Government has also committed $1.5 billion to support the development common user marine infrastructure at the Middle Arm Sustainable Development Precinct. The precinct will co-locate industries ‘such as green hydrogen and critical minerals [processing] with associated downstream opportunities for onshore processing and low-emissions manufacturing’. However, the precinct is also key to development of gas resources the Beetaloo Basin.
International carbon credits
The Paris Agreement, to which Australia is a Party, requires Parties to set economy wide absolute emission reduction targets, and to describe these in documents known as nationally determined contributions (NDCs). Article 6 of the Paris Agreement, provides an outline framework for the use of international carbon credits or internationally traded mitigation outcomes (ITMOs). Article 6(1) provides that ‘Parties recognize that some Parties choose to pursue voluntary cooperation in the implementation of their nationally determined contributions to allow for higher ambition in their mitigation and adaptation actions and to promote sustainable development and environmental integrity’. It elaborates in Article 6.2 that ‘Parties shall, where engaging on a voluntary basis in cooperative approaches that involve the use of internationally transferred mitigation outcomes towards nationally determined contributions, promote sustainable development and ensure environmental integrity and transparency, including in governance, and shall apply robust accounting to ensure, inter alia, the avoidance of double counting…’ Australia’s most recent NDC of June 2022 does not rule out the use of international credits.
Joint Standing Committee on Treaties
In February 2020, the Joint Standing Committee on Treaties considered the 2009 and 2013 amendments to the London Protocol and recommended that binding treaty action be taken.
House Standing Committee on Climate Change, Energy, Environment and Water
On 30 November 2022, the Minister for Environment and Water asked the House Standing Committee on Climate Change, Energy, the Environment and Water to inquire into and report on the 2009 and 2013 amendments to the London Protocol.
The House Standing Committee adopted the inquiry on 23 January 2023. It received 22 submissions and held 1 public hearing.
The Committee’s report was tabled in the House of Representatives on 13 June 2023, recommending that the Australian Government ratify both the 2009 and the 2013 amendments to the London Protocol.
Senate Environment and Communications Legislation Committee
The Bill has been referred to the Senate Environment and Communications Legislation Committee for inquiry and report by 27 July 2023. Details are available at the inquiry homepage. The inquiry received 36 submissions and did not hold a public hearing.
The Committee recommended that the Bill be passed. The Committee report noted that evidence received in submissions to the inquiry focused on economic, technical and environmental issues which, while worthy of public debate, were not central to the Committee’s inquiry into the provisions of the Bill. The Committee concluded:
On balance, the committee is satisfied that the concerns about environmental impacts can be addressed through the current and proposed regulatory framework. In this regard the committee notes the DCCEEW has indicated that Australia would take a precautionary approach to evaluating activities seeking to undertake legitimate marine geoengineering research. Overall, the committee is of the view the bill will help meet Australia’s international obligations under the London Protocol.
However, the Australian Green’s issued a dissenting report. Their report expresses the view ‘the priority should be placed on the reform of our federal environmental law, including the addition of a climate trigger to stop further pollution’. They recommended that:
Should the legislation be brought to the Senate to be voted on, a number of amendments must be made to ensure there is no damage to the environment or climate this bill claims to protect. These include:
- With specific reference to the Bayu Undan project in Timor Leste, the government must outline the regulatory capacity and readiness on the part of Timor Leste to ensure the same level of environmental protection as Australia, and if so, the mechanisms by which this will be achieved.
- Restrict the scope of Ministerial discretion in decision making by amending the Bill to provide stricter and more prescriptive provisions for the issuing of CO2 export permits.
- Amend the Bill to mandate an environment impact assessment be conducted prior to the granting of a permit Amend the Bill to mandate compliance with both the International Maritime Organization’s 'Risk Assessment and Management Framework for CO2 Sequestration in Sub-Seabed Geological Structures' and the 'Specific Guidelines on Assessment of CO2 Steams for Disposal into Sub-Seabed Geological Formation (the Specific Guidelines)'.
- Amend the Bill to clearly define the relationship between the Bill and other regulatory frameworks—including the OPGGS Act, the EPBC Act and state-based environmental regimes.
- Amend the Bill to clearly articulate the responsibilities of the Australian government and permit holders in relation to transboundary liability in the event of accident or adverse environmental outcome.
Senate Standing Committee for the Scrutiny of Bills
At the time of writing, the Senate Standing Committee for the Scrutiny of Bills is yet to consider the Bills.
Policy position of non-government parties/independents
At the time of writing, the Liberal-National Coalition do not appear to have commented directly on the Bill. However, the Bill appears to cover the same subject matter as the Environment Protection Sea Dumping (Miscellaneous Amendments) Bill that was previously proposed for introduction by the Morrison Government in the April 2022 sittings, to:
amend the Environment Protection (Sea Dumping) Act 1981 to implement changes made to the London Protocol allowing for the export of carbon dioxide for the purposes of geo-sequestration and to regulate the placement of matter for ocean fertilisation.
That Bill was not tabled due to the prorogation of the 46th Parliament.
The Morrison Government provided extensive support for CCS, through research and development funding, direct grants, and other measures. According to Departmental estimates ‘[s]ince 2008, the Australian Government has committed over $790 million to support research, development and demonstration of CCUS [carbon capture, use and storage] technologies and potential CO2 storage sites’.
Senator Peter Whish-Wilson, taking the position that there is a lack of evidence of commercial scale, cost-effective CCS in the ocean, has observed that ‘proper scrutiny [of this bill] is going to be critical’.
In a dissenting report to a Senate inquiry in 2018, Senators Richard Di Natale and Janet Rice wrote ‘CCS is an experimental, largely unproven technology’ and noted evidence to that inquiry that that the consequences of storing gas underground were unknown and that ‘there are also potential direct dangers from the storage of carbon dioxide’.
On 8 February 2023, the Australian Greens Leader in the Senate, Senator Larisa Waters, moved a motion proposing that 3 legislative instruments relating to carbon capture and storage (including the methodology determination that allows Australian Carbon Credit Units to be generated by CCS projects) be disallowed (as referred to above). The motion was unsuccessful.
Independent member for Kooyong, Dr Monique Ryan, has questioned the ethics of Australia exporting carbon dioxide to Timor-Leste.
Position of major interest groups
Industry participants, representative bodies and research organisations
Oil and gas companies, representative bodies and research organisations – with a focus on CCS – strongly support passage of the Bill.
The CO2CRC, whose members include oil and gas organisations, universities and State and Federal government agencies, considers Australia’s ratification of the Article 6 amendment ‘essential’. The CO2CRC submitted:
the signing will yield significant environmental and economic benefits to Australia, its major Asia Pacific trading partners, and neighbouring developing countries such as Timor Leste. Failure to sign, or further delays, would entail significant risks to the projects necessary to deliver the government’s legislated emission targets.
The CO2CRC states that ‘there are approximately 15 large CCS projects which are in the concept selection, development or operations phases, with many more in the earlier evaluation phase’. Five to six of these projects are described as ‘already contingent’ on ratification of the 2009 amendment and its provisional application. It argues that:
... [the revised] Safeguard Mechanism effectively mandates the use of CCS in all new gas projects, as well as in other high-emissions industries such as cement and steel (i.e. in hard-to-abate sectors). The approvals of these new CCS projects are both time-sensitive and dependent upon an appropriate and supportive domestic regulatory framework.
The CO2CRC argues that ‘a once-in-generation-opportunity...’ ‘could be lost if Australia does not modernise its legislative framework’ by reducing the timeframes for project approvals and ratifying the 2009 amendment.
Brent, McDonald and Simon observe that the House Inquiry did not consider issues such as the impact of the provisions on subsidies and incentives encouraging investment in research or the (eventual) availability of carbon credits for marine geoengineering activities. They argue that while the Bill ‘favours risk management, which is appropriate at the early stages of research and development’, ... ‘by ruling out future [commercial] deployment, Australia may undermine incentives to advance research’.
Professor Samantha Hepburn argued that the ‘offshore carbon capture storage has not worked effectively in Australian waters’ and cautioned that ‘it’s unclear how [poorer] countries will acquire the capacity and knowledge to achieve successful carbon storage when wealthy fossil fuel companies operating in Australia could not’.
Several Commonwealth departments provided submissions to the Senate inquiry.
The Department of Foreign Affairs and Trade (DFAT) submission argues that passage of the Bill and subsequent ratification steps (to facilitate provisional application of the 2009 amendment) are crucial for supporting Australia and its’ regional partners’ net zero goals. Specifically, DFAT argues that several proposed projects are dependent on provisional application of the 2009 amendment in Australia, including the investment of Japanese and Korean joint venture partners in Santos’ proposed exploitation of the Barossa offshore gas field, development of the Darwin LNG hub, and conversion of the Bayu-Undan offshore oil and gas field (in Timor Leste) into a CCS storage project. The submission also indicates that the Republic of Korea and Singapore are also exploring the feasibility of exporting CO2 to Australia.
The DISR submission states ‘...this is a relatively new area of policy. There are complex policy, legal, environmental and economic issues that will require consideration depending on the potential source and destination of a carbon dioxide stream’. However, the submission does not provide further elaboration of these issues.
Environment and energy non-government organisations
Environment and energy non-government organisations are strongly opposed to the passage of the Bill and consider CCS an unproven technology designed to extend the life of the fossil fuel industry.
The Wilderness Society has urged the government to deliver overdue reforms to the EPBC Act, ahead of ‘fossil fuel industry demands’. The Wilderness Society submitted:
It is disappointing that the Albanese government has created space within its environmental legislative agenda for this before effective, future focused environment laws that would actually help the environment are brought forward. Urgent environmental matters lay dormant while the needs of the fossil fuel industry leap ahead of the queue.
The Wilderness Society point to the $60 billion decommissioning liability of the oil and gas industry and argue that the Government should refuse to issue greenhouse gas activity permits or approvals to any oil and gas companies with outstanding decommissioning liabilities.
The Environment Centre NT has expressed concerns that ‘the changes would be used to facilitate the expansion of gas developments such as Santos’ Barossa offshore project, which it has proposed will include a CCS facility in the depleted Bayu-Undan gas reservoir in waters off Timor‑Leste’. Dr Kirsty Howie (director) said:
CCS hasn’t been shown to work at scale anywhere in the world. It’s time to give up the ghost and phase out fossil fuels urgently, rather than peddling false solutions like CCS to justify their expansion.
The Institute for Energy Economics and Financial Analysis (IEEFA) argue that the long title of the Bill is misleading, as ‘it will neither use new technology, nor will [the amendments] fight climate change’. They argue that the ‘proposed legislation to enable Australia to import and bury other countries’ carbon dioxide (CO2) emissions should not go ahead’, citing a ‘a dangerously high risk of financial and legal liability’.
Kevin Morrison, an energy finance analyst at IEEFA, argues that ‘any economic benefits derived from importing other countries’ emissions for disposal has to be balanced against the risk – financial and otherwise – that Australia would be lumbered with’.
IEEFA also point to CCS’s history in enhanced oil recovery, and state that CCS does not address the vastly greater proportion of scope 3 emissions generated at the time fossil fuels are burned.
Environmental law offices
Some public interest environmental law firms also strongly opposed to the passage of the Bill. The Environmental Defenders Office (EDO) submitted:
...policies such as CCS and geoengineering carry the risk of justifying ongoing use and extraction of fossil fuels, and strongly recommends they should not be promoted or encouraged in order to sustain the life of the fossil fuel industry. CCS in particular also carries significant risk of additional and unintentional emissions pollution in its operation, while the environmental and social risks of large scale geoengineering remain unknown.
EDO, among other stakeholders, observe that the interactions between the proposed amendments to the Sea Dumping Act and other relevant legislation, such as the OPGGS Act, are unclear.
Environment Justice Australia (EJA) identifies several significant and ‘intractable problems’, including inadequate risk management provisions, issues of climate injustice associated with the export of emissions to poorer neighbouring countries, avoided responsibility for greenhouse gas pollution, and facilitation of fossil fuel expansion.
The Maritime Union of Australia (MUA) submitted that the Sea Dumping Act should be reviewed (and permit fees updated), particularly with a view to ensuring appropriate application and consistency in requirements of the Act and the OPGGS Act in regard to the disposal of offshore oil and gas infrastructure. The MUA expressed concerns that aging oil and gas infrastructure would be repurposed ‘regardless of its appropriateness as a way of avoiding full removal of the equipment’ as part of decommissioning obligations.
The Explanatory Memorandum states that the Bill will have no financial impact on the Australian Government budget.
The 2023–24 Budget measure ‘Working with the Australian resources industry on the pathway to net zero’ included $12.0 million over 3 years from 2023–24 for ‘a review of the environmental management regime for offshore petroleum and greenhouse gas storage activities to ensure it is fit for purpose for a decarbonising economy’. Notably,
...the review will also examine opportunities to provide regulatory and administrative certainty for offshore carbon capture and storage projects to enable Australian industry to meet net zero targets whilst delivering domestic energy security and regional energy security. [emphasis added]
The October 2022 Budget contained a statement regarding ‘realignment of investment in carbon capture technologies’, indicating $141.1 million would be provided over 10 years from 2022–23 for the establishment of the Carbon Capture Technologies for Net Zero and Negative Emissions program to be administered by DCCEEW.
Commonwealth indemnity for greenhouse gas storage injection activities
The Offshore Petroleum and Greenhouse Gas Storage Act contains provisions for the Commonwealth to indemnify a greenhouse gas injection licensee against future liability in relation to sequestration at a particular site, following a closure assurance period of at least 15 years. Such a period may be declared if the responsible Commonwealth Minister is satisfied that sequestered greenhouse gas is behaving as previously modelled in the approved site plan, that there is no significant risk of major impact on geotechnical integrity, human health or safety, or the environment.
Under the OPGGS Act, subject to several statutory preconditions, the Commonwealth is required to indemnify a person if a person who is or has been the registered holder of a greenhouse gas injection licence subsequently incurs or accrues (after the closure assurance period has ended) a liability for damages and the liability is attributable to an act or omission during the operation of the licence relating to the carrying out of GHG injection operations. The Commonwealth is also taken to assume the liability of any such licence holder who no longer exists.
The relevant Western Australian Act contains a similar provision. However, the Australian Government has entered into an agreement in which the Australian Government agrees ‘to provide the [WA] State Government with a “back to back” indemnity for 80% of any liability the State incurs as a result of third party common law claims associated with the CO2 injection project’. This commitment is reflected as an unquantifiable contingent liability in the Australian Government’s Budget Papers. This arrangement creates an expectation that the Australian Government will also provide an indemnity for other projects in coastal waters.
Statement of Compatibility with Human Rights
As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible.
Parliamentary Joint Committee on Human Rights
At the time of writing, the Parliamentary Joint Committee on Human Rights had not considered the Bill.
The Sea Dumping Amendment Bill includes several key new provisions and amendments to existing provisions which seek to implement the 2009 and 2013 amendments to the London Protocol. This section does not consider the numerous consequential amendments that flow from those new and amended provisions.
Objects and definitions
The Sea Dumping Act was enacted in 1981 to provide the legislative basis for giving effect to Australia’s obligations under the London Convention. The Act has been amended numerous times (although not comprehensively), including to repeal references to the London Convention and refer instead to the London Protocol, to take account of changes in international maritime agreements and boundaries, and to provide for permits for the placement of artificial reefs.
The Act does not have an objects clause. An objects clause provides a general understanding of the purpose of the legislation or sets out general aims or principles that assist in interpreting the detailed provisions of the legislation. Some submitters to the Senate inquiry suggest that an objects clause should be included in the Bill, specifically incorporating the application of the precautionary principle as enunciated in the London Protocol and a requirement that carbon projects subject to permits result in genuine emissions reductions.
Key definitions are provided in section 4 of the Act. The Bill adds or amends several key definitions. For example,
- a new definition of marine geoengineering activity is added, with reference to Article 1 ‘Definitions’ of the London Protocol and activities listed in Annex 4 of the Protocol
- the existing definition of controlled material (‘wastes or other matter within the meaning of the Protocol, and a vessel, aircraft or platform’) is amended by removing reference to ‘within the meaning of the Protocol’ and a new definition of wastes or other matter is added, with reference to the meaning given by Article 1 ‘Definitions’ of the London Protocol.
Granting of permits
The Sea Dumping Act currently contains offence provisions relating to:
- the dumping of controlled material into Australian waters or from an Australian vessel, aircraft or platform into any part of the sea
- the incineration of controlled material at sea on a vessel or platform in Australian waters, or on an Australian vessel in any part of the sea
- the loading of controlled material on a vessel, aircraft or platform in Australia or Australian waters, or the loading of controlled material on any Australian vessel or aircraft, knowing or reckless as to whether the material will be dumped or incinerated at sea
- the export of controlled material to another country knowing or reckless as to whether it will be dumped or incinerated at sea
- the placement of an artificial reef other than in accordance with a permit.
The offences are indictable offences but may be heard in a court of summary jurisdiction (that is, a lower court). The offences are subject to tiered maximum penalties, depending on whether the offending material is seriously harmful material, an offending material not within Annex 1 of the London Protocol, or in ‘any other case’. Seriously harmful material is defined as ‘radioactive material or any other material prescribed in the Regulations’. No such materials have been prescribed in the Environment Protection (Sea Dumping) Regulations 1983. It is unclear if the Government intends to amend the Regulations to define carbon dioxide streams as a seriously harmful material.
The offence provisions do not apply in circumstances in which the action is undertaken in accordance with a permit granted by the Minister under the Act.
A person may make an application to the Minister for the grant of a permit and the Minister may, in their absolute discretion, grant or refuse to grant a permit. The Act does not prescribe the type of information that should be provided in support of an application, and existing subsection 19(8A) sets out matters (so far as they are relevant) that the Minister must have regard to in deciding whether to grant a permit.
Numerous submitters to the Senate Inquiry (including ACF, AMCS, ENCT, EJA, the NELA and LTGA) express concern that the Act does not contain a requirement for environmental impact assessment of proposed activities.
Rather, existing subsection 18(4), provides that if in the Minister’s preliminary consideration of the application the Minister forms the view that ‘it will be necessary for research or analysis to be undertaken to determine the effect of the proposed’ activity, the Minister may require the applicant to enter into an agreement with the Commonwealth relating to any or all of the following:
- undertaking of that research and analysis
- reimbursement of the Commonwealth’s expenses incurred in undertaking or supervising the undertaking of that research and analysis
- reimbursement of the Commonwealth’s expenses incurred in undertaking that research and analysis in circumstances in which the applicant failed or neglected to do so
- payment of a security by the applicant for any amount for which they may become liable under the agreement
- reporting of the results of any research or analysis.
Similarly, existing subsection 19(9) provides that before granting a permit, the Minister may require the applicant to enter into an agreement with the Commonwealth relating to ‘the consequences of the release into the marine environment through the proposed activity’, among other matters.
New offences and permits
Export of carbon dioxide streams from carbon dioxide capture processes for sub-seabed sequestration
As outlined above, the Act currently contains an offence provision relating to the export of controlled material. Item 1 of the Bill repeals and replaces existing subsection 10D(1) to extend the offence provision to circumstances in which:
- a person exports a controlled material, knowing or reckless as to whether it will be dumped into the sea or incinerated at sea, and
- where the controlled material is carbon dioxide streams from carbon dioxide capture processes for sequestration into a sub-seabed geological formation, the export is not in accordance with a permit.
Based on existing subsections 10D(2) and paragraph 37(3)(c), the applicable penalty would be imprisonment for up to 1 year or a fine up to 250 penalty units, or both, or if tried summarily imprisonment for up to 6 months or a fine of up to 60 penalty units, or both. This is because carbon dioxide streams are not defined as seriously harmful material.
As outlined above, the Act currently provides that the Minister may grant permits required for the purposes of the Act. Item 3 of the Bill inserts proposed subsection 19(7B) to allow the Minister to grant a permit for the export of controlled material to another country for dumping if the Minister is satisfied:
- that the controlled material is carbon dioxide streams from carbon dioxide capture processes for sequestration into a sub-seabed geological formation; and
- of the matters referred to in paragraphs 4.1, 4.2 and 4.3 of Annex 1 to the Protocol; and
- that there is an agreement or arrangement in force between Australia and the other country that includes the matters covered by paragraphs 2.1 and 2.2 (as appropriate) in the Annex to Resolution LP.3(4) ...; and
- that the grant of the permit would be in accordance with Annex 2 to the Protocol; and
- of any other matters that the Minister considers relevant.
Numerous submitters to the Senate Inquiry argue that the Minister should also be required to specifically consider the 2012 Specific guidelines and the Risk Assessment and Management Framework agreed by the Contracting Parties to the Protocol. In addition, noting that the export could be to a developing country who may also be a non-Contracting Party, EJA argue that, in considering whether it is appropriate to export carbon dioxide streams, the ‘Minister should be required to consider independent information about the regulatory framework and governance capacity of the destination country, and to be reasonably satisfied that CO2 from Australian projects sent overseas for storage will be successfully and permanently stored underground’.
Marine geoengineering activity
Items 16, 17 and 18 of the Bill inserts proposed sections 10AA, 10CA and 10DA establishing new offences in relation to the:
- placement of wastes or other matter into Australian waters, or any other part of the sea from an Australian vessel or aircraft, for marine geoengineering activities, where the placement is not in accordance with a permit
- loading of wastes or other matter, knowing or reckless as to whether the wastes or other matter will be placed into Australian waters, or any other part of the sea, for a marine geoengineering activity, and knowing or reckless as to whether the placement will not be in accordance with a permit
- export of wastes or other matter, knowing or reckless as to whether the wastes or other matter will be placed into Australian waters, or any other part of the sea, for a marine geoengineering activity, and knowing or reckless as to whether the placement will not be in accordance with a permit.
In each case, the applicable penalty is:
- if the wastes or other matter is seriously harmful material, imprisonment of up to 10 years or a fine of up to 2,000 penalty units or both, or if the matter is heard summarily, imprisonment of up to 2 years or a fine of up to 240 penalty units, or both
- in any other case, imprisonment for 12 months or a fine of 250 penalty units, or both, or if the matter is heard summarily, imprisonment of up to 6 months or a fine of up to 60 penalty units, or both.
Item 35 of the Bill inserts proposed subsection 19(7C) to allow the Minister to grant a permit for the placement of wastes or other controlled matter into Australian waters, or into any part of the sea from any Australian vessel or Australian aircraft, for a marine geoengineering activity if the Minister is satisfied:
- that the placement of wastes or other matter for that activity is for scientific research covered by Annex 4 to the Protocol; and
- that pollution of the marine environment from the placement of wastes or other matter for that activity would, as far as practicable, be prevented or reduced to a minimum; and
- that the placement of wastes or other matter for that activity is not contrary to the aims of the Protocol; and
- that the grant of the permit would be in accordance with Annex 5 to the Protocol, taking into account any Specific Assessment Framework:
- that is referred to in paragraph 3 of that Annex; and
- that has been adopted by the Parties to the Protocol; and
- that is in force from time to time; and
- of any other matters the Minister considers relevant.
The Assessment Framework does not use the phrase ‘legitimate scientific research’, but sets out the following criteria for determining – at the initial assessment phase – whether a proposed activity has ‘proper scientific attributes’:
.1 The proposed activity should be designed to answer questions that will add to the body of scientific knowledge. ...
.2 Economic interests should not influence the design, conduct and/or outcomes of the proposed activity. There should not be any financial and/or economic gain arising directly from the experiment or its outcomes. ...
.3 The proposed activity should be subject to scientific peer review at appropriate stages in the assessment process. ...
.4 The proponents of the proposed activity should make a commitment to publish the results in peer reviewed scientific publications and include a plan ... to make the data and outcomes publicly available in a specified time-frame. [author’s abbreviation]
The Sea Dumping Act operates in conjunction with the OPGGS Act and the EPBC Act. These Acts contain existing mechanisms for the assessment and approval of activities, including the sequestration of carbon dioxide streams from domestic sources in sub-seabed geological storage formations and the assessment and approval of actions that have a significant impact on matters of national environmental significance. Importantly, the EPBC Act is currently undergoing a major reform process and exposure drafts of amending legislation are expected to be released in the coming months.
The existence of numerous regulatory frameworks raises issues of regulatory consistency, duplication and siloing, impacting the ability of project proponents, major interest groups, and the public to navigate and effectively engage in those regulatory processes. It is notable that several departments recognise that the issues being regulated are novel and complex and point out that further work will be required – after the Bill has been passed.
Import of carbon dioxide streams
The Sea Dumping Amendment Bill does not include any provisions relating to the import of carbon dioxide streams. According to the DCCEEW:
Any import of CO2 for sub-seabed sequestration will be subject to a bilateral agreement or arrangement between the exporting State and the Australian Government ...
Any application to sequester imported CO2 in sub-seabed geological formations within Australia’s jurisdiction would be assessed against the same regulatory frameworks and to the same standards as domestically sourced CO2.
The Department’s submission also indicates that additional permits or approvals may be required under the Customs Act 1901 and the Biosecurity Act 2015.
It is unclear what level of transparency there will be around the import of carbon dioxide streams for sequestration, with agreements with Contracting and non-Contracting Parties to the London Protocol to be negotiated on a case-by-case basis. For example, while project documentation submitted for assessment under the OPGGS Act and EPBC Act (where applicable) would be expected to clearly indicate that a project expects to receive carbon dioxide streams from other sources, it is possible that some aspects of arrangements will be subject to commercial-in-confidence claims.
Transparency and consultation
Existing section 25 of the Act provides that the Minister must publish certain matters in the Gazette, including applications for permits, permits granted and any associated conditions, refusals to grant permits, and any revocation, variation, suspension or cancellation of the suspension of a permit. The Act does not stipulate timeframes for the publication of such information.
The Act does not currently include requirements for public consultation in relation to permit applications, notification of interest holders (such as native title holders), or an associated requirement for the Minister to have regard to comments received from the public or interest holders.
Notably, the requirements for consultation and public disclosure of assessment and authorising documentation are also set out in the Assessment Framework. The 2012 Specific Guidelines also recommend ‘that opportunities are provided for public review and participation in the permitting process’.
Several stakeholders suggested improvements to transparency of permit applications, requirements for consultation, and reporting. For example, the EJA argues that the Bill should be amended to include ‘transparency measures’, including public exhibition of permit applications, a requirement that the Minister have regard to public submissions, and third-party merits review of permitting decisions. IEEFA also argues that the Bill should be amended to ‘enhance legal and environmental protections, transparency and accountability of proposed transboundary CCS projects’.
The present Bill seeks to amend the Sea Dumping Act to implement the 2009 and 2013 amendments to the London Protocol. These would provide a framework to regulate the export of carbon dioxide streams for sub-seabed sequestration in geological formations and for marine geoengineering activities respectively. While it is unclear if and when the 2013 amendments will enter into force for Australia, the passage of the Bill and consequent provisional application of the 2009 amendment is noted to be crucial for the viability of several proposed CCS projects which will export or import carbon dioxide streams from or to Australia for sub-seabed sequestration in geological formations.
Submissions to the Senate inquiry indicated the opposing views of major interest groups, with the oil and gas industry strongly in favour of the Bill and all other groups raising numerous serious concerns, including that the so-called ‘new technologies’ distract from the urgent need to reduce greenhouse gas emissions at source.
Author acknowledgement: with thanks to Lizzie Smith and Dr Martin Smith for assistance with background research and Dr James Prest for peer review of an earlier version of this Digest.