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Dutton doubles down on gas, rejects support for mining

The gas sector has been sold out and barriers to expansion must fall, but the mining industry should not get new production incentives, according to the coalition.

Opposition Leader Peter Dutton used a keynote address to a gas conference in Perth on Thursday to slam the federal government's support for "green activist crusades" and excessive red and green tape that he says is stifling investment in gas.

He accused the deeply divided Labor party of dishonestly backing gas in a new long-term strategy and at the same time making gas projects ineligible for funding as billions are spent to build out the electricity grid.

"We do need our country to get back on track. Gas remains essential for affordable and reliable energy for all Australians," he said.

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"It's why we want to ramp up domestic gas production."

Mr Dutton also promised to release details on "zero-emission nuclear power" before the next election to stop Australia being an outlier amongst 20 advanced economies in ignoring this clean energy source.

But he dug in against tax breaks for processing critical minerals and incentives for hydrogen production in the recent federal budget, which are yet to pass parliament.

"We're not going to do anything other than have an efficient process in place," he told reporters at the Australian Energy Producers conference.

As well as allowing the development of new east coast gas, carbon credits for trapping emissions would be an incentive for developing Australia's carbon storage potential and lower-carbon gas supplies, the industry says.

Gas giant Santos has almost finished building one of the world's largest carbon capture and storage (CCS) facilities, the Moomba project in South Australia's outback, with first injection on track for later in 2024.

The proven technology has the potential to have a greater impact on emissions reduction than decarbonising an electricity network, chief executive Kevin Gallagher said.

North Asian industrial giants are already taking a close look at Australian expertise in CCS, with a Korean contingent visiting Chevron Australia's Gorgon operations this week on Barrow Island at the northwest tip of the nation.

Santos plans to take emissions from domestic heavy industries, including steel furnaces and chemical refineries, depending on supportive government policy and industry investment.

Kevin Gallagher
Kevin Gallagher says Santos believes it can make money out of carbon management services. (Matt Turner/AAP PHOTOS)

The company's "low-carbon fuel strategy" also puts the Cooper Basin at the heart of a future fuel made from combining hydrogen and carbon dioxide, which they say could be a "drop-in" replacement for gas.

Mr Gallagher urged Australia to fast-track all regulatory frameworks for approvals to build new CCS projects and how to govern and monitor their performance.

"Carbon credits, qualifying for ACCUs (Australian carbon credit units), would be a big incentive," he said.

With capacity to store up to 1.7 million tonnes of carbon per year, start-up injection rates at Moomba could build to about 20 million tonnes of carbon a year for up to 50 years.

The proposed Bayu-Undan project offshore Timor-Leste, to be operated by Santos, could store more than 10 million tonnes of carbon a year.

Under the emission safeguard reforms new ACCU projects can no longer be approved for reducing emissions from the nation's big-emitting facilities covered by the scheme.

The pre-existing Moomba CCS project can continue, but legislatives changes ensure it cannot double count the emissions reductions to meet steeper reduction requirements.

The reporter travelled with the support of Chevron Australia.