Delivering a responsible energy future in Australia

Simon Allison

Regional Director of APAC, Xodus Group 

Simon Round

For the energy sector, the last two years have been a real game changer. We have seen a significant shift in the requests we receive from clients, increasingly focused on renewables opportunities, decarbonisation of existing assets to CCUS and more decommissioning activities. The Australian energy landscape is being repositioned. 

From the outside, oil and gas companies may have been criticised for moving too slowly on global climate issues, but for an industry that has been established for more than 100 years, two years is a small fraction. With the huge changes brought by the energy transition, the impact of COVID-19 and then the drop in oil price on the industry, businesses are now looking at mixed energy portfolios. 

It is important we do not underestimate the role of oil and gas in the energy transition. The transformation of the energy sector may be possible without the oil and gas industry, but it would be more difficult and more expensive. The challenge for the industry is to both engage and adapt to a changing policy and investment landscape and, despite the current economic challenges, many companies are working to decarbonise their operations and their value chains. 

With high insolation levels, favourable conditions for wind farms, immense availability of land and being girt by sea, Australia offers an attractive environment for large utility-scale renewable developments. In the past year, we have seen an upward trend in energy generation renewable projects, including offshore wind, solar and hydrogen. 

With this in mind and with the corporate sector driving change, which is supported by all state and territory governments, Australia is well placed to make significant progress towards the energy transition. Unfortuantely, the federal policy position is lagging although it is improving, with the Prime Minister announcing earlier this year that the goal is to achieve net-zero emissions as soon as possible, preferably by 20501. The Commonwealth Government released a discussion paper for a proposed Offshore Clean Energy Infrastructure regime2, which focuses on offshore wind and signals the intent of developing the technology. A more robust net-zero commitment from the top would accelerate Australia’s transition efforts. 

Bridging the skills transition gap   

The world is at a pivotal time for energy demand and use. An integrated approach to energy systems will help tackle the dual challenge of decarbonising oil and gas and more rapidly advancing low carbon solutions. But a net-zero focus also requires a shift in how skills are addressed. 

As the Australian energy industry moves forward with energy transition initiatives, it will be our ability to think differently, adapt to the unique in-country conditions and our confidence to take on lessons learnt in different regions that will ensure our success. 

At Xodus, we are privileged to work closely with our colleagues in the UK and US to leverage their experience. With this shift on cleaner projects, we enter a new phase that requires us to think differently about how we apply our skills and experience. Our team brings together diverse and substantial technical expertise to address new opportunities and look at previous problems differently. 

For our clients and partners the skills transition means that our people use their expertise on a much wider range of issues. There is a bigger drive for innovative thinking and, as an industry, we need to get better in terms of quick adoption of new technologies. 

However, the fundamentals remain the same. With new energies and technologies being discussed throughout the energy sector, proven engineering to support this shift is going to be more important now than ever. From platform to shore the subsea and seabed challenges such as wave and current effects, fishing, shipping and seabed mobility remain the same for both traditional oil and gas and renewables. 

The next step to enable the transition would have to come from the Australian government putting in place measures similar to the North Sea Transition Deal3 to ensure that highly skilled oil and gas workers and the supply chain will not be left behind. 

These sector deals between government and industry can support workers, businesses, and the supply chain through the transition by harnessing the industry’s existing capabilities, infrastructure, and private investment potential to exploit new and emerging technologies. 

Adopting a similar approach in Australia could both accelerate the transition and ensure that we safeguard the security of our energy supply while supporting high-value jobs and the expertise necessary to achieve a lower carbon future.  

A focus on decommissioning 

Australia's asset pool is ageing and decommissioning in the region is still in its infancy; we can see that through the ongoing engagement between state and federal governments, regulators and industry. Last year National Energy Resources Australia (NERA) produced a report on Australia’s offshore decommissioning liability and the findings were eye opening. More than $A50billion of decommissioning work needed on the country’s offshore oil and gas infrastructure, over half of which needs to be initiated within the next 10 years. 

As a result, NERA recently launched The Centre of Decommissioning Australia (CODA) 4. Xodus has been involved in the inception of the new centre and is excited to see how the collaborative industry effort will maximise the opportunities of decommissioning Australia’s ageing oil and gas infrastructure.  

The future of energy 

According to ENB’s Future of Energy survey, most companies expect renewable energy penetration in Australia to grow by more than 10% by 2030. Most respondents believe there is valuable expertise and experience in the energy industry to support the changing energy mix and I agree.  

Lately, our team has taken on new challenges grounded in their years of energy experience. Our Perth team includes consultants using their skills in managing uncertainty and decision making to areas outside traditional oil and gas. They also see their expertise in gas processing being applicable to reducing emissions, hydrogen and CO2 sequestration, or that routing a subsea cable correlates directly to a pipeline. Many skills are universal. Based on our experience supporting companies through the energy transition and identifying and capitalising on low carbon solutions we are developing smarter ways of working to help lead us into the future of energy. 

Xodus is excited to see where our integrated services, backed up by specialist tools and training, span the numerous disciplines involved in delivering complex energy projects, including geotechnical, subsea, pipelines and cables, integrity, vibration, safety, risk, environment, and commercial and fiscal advice, will take us. Working both onshore and offshore, we partner with clients, striving to deliver a responsible energy future. 

Published Date
03 Apr 2022
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