ETS threat to gas projects

Courier Mail
Tuesday 21/10/2008 Page: 55

OIL major Chevron Corp says Australia's proposed emissions trading scheme (ETS) could jeopardise the development of the multibillion dollar Gorgon and Wheatstone liquefied natural gas projects in Western Australia. Chevron Australia managing director Roy Krzywosinski said that in its existing format, the ETS could significantly increase the operating costs of the two projects and put the viability of the investments in danger. "This result could very well increase the operating costs of the Chevron-operated Gorgon and Wheatstone projects by $100 million to $200 million each per year," Mr Krzywosinski said.

"This is an additional cost that could put the viability of these massive investments in jeopardy." Mr Krzywosinski's comments echoed those of Woodside Petroleum chief executive Don Voelte, who has been critical of the scheme and warned that the company might cut spending on its key LNG projects if the ETS went ahead in its current form. Economist Ross Garnaut, who is advising state and federal governments on climate, recommended emissions trading start in 2010.