Committed to a lower-carbon future
A better tomorrow needs action todayTaking action: tree planting
Woodside accepts the scientific consensus on climate change
We support the Paris Agreement and its goal to limit the rise in global temperature to well below 2°C from pre-industrial levels and to pursue efforts to limit it to 1.5°C. To help reduce global emissions, our climate change strategy is to build and maintain a carbon-resilient portfolio including natural gas and new energy technologies. We are committed to limiting our greenhouse gas emissions through efficient operations and design together with carbon offsets.
Clear targets to decarbonise
We have set clear targets to reduce net emissions below the gross 2016-2020 annual average, on the pathway to our aspiration of net zero by 2050:
aspiration by 2050
Woodside prospers in a lower-carbon world
Our strategy is underpinned by four pillars.
A sustainable future will require emissions reductions to be achieved whilst providing the safe, clean, affordable and reliable energy the world needs.
Woodside is well placed to be a part of the global energy transition. Our gas can help reduce emissions, displacing more intensive energy sources such as coal and biomass, while enabling customers to deliver affordable energy and climate action.
We build and maintain a carbon- resilient portfolio by conducting comprehensive financial forecasting that considers the risks and opportunities presented by a transition to a lower-carbon economy.
These include political risk, policy and regulatory developments, economic growth in our key markets, exchange rates, price shocks due to industry or producer behaviour, and specific technology developments that might impact demand for our products.
This forecasting process results in a range of oil and gas price assumptions, which inform our investment decisions. As a result, we are confident our growth projects align with a Paris-compliant world.
For more information on our how we are maintaining and building a carbon-resilient portfolio refer to our Task Force on Climate-related Financial Disclosures aligned disclosures in our 2020 Annual Report.
We’re aiming to be net zero in our direct emissions by 2050 or sooner for our equity share of Scope 1 and Scope 2 emissions. Scope 1 emissions are those that arise directly from our operations, such as from the use of fuel, flaring, or from the production of naturally occurring CO₂ from our petroleum reservoirs. Scope 2 emissions are those associated with the generation of any power that we purchase.
Woodside has set clear targets to reduce net emissions below the gross 2016-2020 annual average, on the pathway to our aspiration of net zero by 2050:
- 15% by 2025
- 30% by 2030.
We will meet these targets by:
- Avoiding emissions through the way we design our facilities
- Reducing emissions through the way we operate our facilities
- Offsetting emissions, by both acquiring and originating quality offsets.
In 2018, we established a carbon business focused exclusively on generating and acquiring offsets. We have invested more than A$100 million across Australia through native tree planting over the past 10 years. At the end of 2019, our partnership with CO2 Australia had offset more than 700,000 tonnes of CO²-e from Pluto LNG Train 1. The Woodside Native Reforestation Project, in partnership with Greening Australia, has planted 2,400 hectares in WA during 2020 which is estimated to sequester about 700,000 tonnes of CO²-e over 25 years.
We are committed to playing a role in the world’s energy transformation by developing new energy and low carbon solutions. We’re continuing to invest in improving our understanding of the role hydrogen can play in global decarbonisation, including:
- Jointly investing more than A$40M with Monash University in the Woodside-Monash Energy Partnership to explore new energy technologies, including hydrogen
- Progressing the proposed H2TAS Green Hydrogen project which has been shortlisted for the next stage of funding from the Australian Renewable Energy Agency (ARENA)
- Developing markets for LNG as a new and cleaner fuel for land-based use (e.g. remote power generation) and shipping. We have already successfully piloted these projects at small-scale
- Looking for opportunities to use carbon capture and storage (CCS) at scale.
For more information on how we are limiting our emissions, refer to our Task Force on Climate-Related Financial Disclosures aligned disclosures in our 2020 Annual Report and 2020 Sustainable Development Report.
Rising mean air temperatures and the increased severity of tropical cyclones have been identified as the main physical risks to Woodside’s operating assets. These changes to the climate, among others, could impact the health and safety of our employees and our ability to meet production targets, as well as impact our operational infrastructure or disrupt supply chains.
We are continually working to improve our resilience to physical risks, including by enhancing our forecasting and risk assessment processes. Our people have been trained to monitor extreme weather events and have experience mitigating their impacts. For instance, we have already taken steps to ensure our assets are resilient to the impacts of rising air and sea temperatures, as well as rising sea levels, by factoring these risks into asset design, which is reviewed every five years.
We have engaged with industry partners and researchers in the field of climate science to enhance our ability to manage climate-related physical risks. For example, our metocean specialists are contributing to the development of industry guidelines for the assessment of physical climate risks through engagement with the IOGP Climate Change Task Force. We have also partnered with Chevron, INPEX, Shell and the Australian Bureau of Meteorology to improve tropical forecasting systems. Our partnership in this area contributed to ensuring the resilience of our assets when Tropical Cyclone Damien directly impacted our facilities in February 2020.
As the world’s population and living standards increase, more energy is required. This will present a challenge to meeting the Paris Agreement goals.
Our Climate Change Policy outlines our commitment to promoting natural gas in the global energy mix as a means to reduce greenhouse gas emissions, support renewable energy and improve local air quality.
Woodside regularly engages with governments of countries where we are active in support of our business strategy to exchange information and to inform policy development and decision making. This engagement is undertaken both directly with governments and by working with industry associations.
When these engagements are on climate-related topics, we are committed to ensuring our own advocacy, and the advocacy of our industry associations is aligned with:
- Support for Paris Agreement goals and commitments and global net zero emissions by 2050.
- Support for appropriate protection to manage the social and economic costs of the transition.
- Support for lower-emissions technologies and other pathways to reducing/offsetting emissions
|Climate-related advocacy undertaken by Woodside, 2020-21|
Crediting below baseline
Woodside made a submission in response to the Australian Government’s discussion paper about a proposed Safeguard Crediting Mechanism. We supported the introduction of the Mechanism as a potential step towards an economy-wide carbon price, and provided technical comments on how the proposal could operate as a low emission technology incentive. Our submission can be viewed here.
|Low Emissions Technology Roadmap|
Woodside made a submission to the Australian Government’s process for developing a Low Emissions Technology Investment Roadmap. It highlighted the need for government support to be aggregated in order to deliver deployment at commercial scale rather than studies and pilots, and advocated for increasing R&D spending to the OECD average and setting ambitious targets for low emissions capacity. Our submission can be viewed here.
|Corporate Emissions Reduction Target|
The Australian Government has proposed to establish a voluntary Corporate Emissions Reduction Target (CERT) Report. Woodside has set clear near- and medium-term targets for corporate emissions reductions and supports the opportunity to be able to report them. Woodside made a submission, advocating for simplicity in reporting, and that reporting should be on an “equity” basis reflecting a share of a company’s emissions from a particular asset.
Woodside’s submission is not publicly available due to the inclusion of commercial-in-confidence information. Woodside has subsequently agreed to participate in a pilot program to commence in 2021.
|The Emissions Reduction Fund and the Safeguard Mechanism|
The Climate Change Authority reviewed the Emissions Reduction Fund (ERF) in 2020. Woodside made a submission addressing various technical and operational aspects of the ERF and encouraging high levels of integrity in carbon accounting, and a deep, liquid and transparent carbon market. Our submission can be viewed here.
The Safeguard Mechanism is a technically complex and evolving regulatory instrument that complements the ERF by ensuring that emissions reductions secured by the ERF are not reversed by increases elsewhere in the economy. Woodside routinely engages with the Commonwealth regulator in connection with technical matters such as the setting of benchmark intensities, production variables and measurement methodologies.
Woodside also contributed to APPEA’s submission on the Emissions Reduction Fund consultation paper which can be viewed here.
|Carbon Capture and Storage ACCU Method|
The Australian Government has proposed to enable CCS projects to earn Australian Carbon Credit Units. Woodside supports the proposal and made a submission advocating various legislative and regulatory changes that would reflect the long term and large scale nature of such projects. Woodside’s submission is not publicly available due to the inclusion of commercial-in-confidence information.
The Commonwealth’s Environment Protection and Biodiversity Conservation (EPBC) Act and the Western Australian Environment Protection (EP) Act have both been recently reviewed by the respective Parliaments. Both of these review processes primarily addressed the efficacy of the legislation and regulation. In so far as climate-related content was addressed, Woodside advocated for clarity of regulatory responsibility for emissions regulation across jurisdictions.
Our submission to the EPBC Act Review can be viewed here.
Our submission to the Government of Western Australia Modernising the Environmental Protection Act Discussion Paper and Exposure Draft Bill can be viewed here.
In addition to these direct government engagements, Woodside also participates in a number of industry associations. Its approach to this is explained in our Industry Association Climate Alignment Review. In particular in recent times Woodside staff have:
- Co-chaired the steering committee of the Natural Climate Solutions Initiative sponsored by the International Emissions Trading Association (IETA).
- Chaired the Net Zero Taskforce of the International Petroleum Industry Environment and Conservation Association (IPIECA).
- Participated in the steering committee of the Australian Energy Transition Initiative which researches the pathways to net zero for Australia’s “hard to abate” industrial sectors.
Further information on Woodside government submissions and reports can be viewed here.
To remain competitive as a cleaner fuel in the long term, the LNG industry needs to continue its journey to reduce methane and carbon dioxide emissions across the entire value chain.
Tom Ridsdill-Smith, Senior Vice President Climate
Climate change resources
- Climate-related data index
- Part of a lower-carbon future (November 2020)
- Industry Association Review Report
- Climate change risk management: Next steps
- 2019 CDP Report (December 2020)
- Our energy future in a lower carbon world
- Carbon Disclosure Project (CDP) submission (November 2018)
- Just transition (July 2021)
- Climate Change Policy (December 2020)
- Woodside backs a carbon price - for the planet, our children, business and jobs