Senate Passes Commonwealth CCS Bill And Provides Certainty On Long-Term Liability

At the beginning of this week, the Senate passed the long awaited Offshore Petroleum Amendment (Greenhouse Gas Storage) Bill (Cth). The Bill amends the Offshore Petroleum Act 2006 (Cth) and establishes a regulatory framework for greenhouse gas (GHG) capture and long-term geological storage (CCS).

The Senate has accepted a Coalition-instigated amendment to the Bill which has the effect of transferring long-term liabilities from CCS licence-holders to the Commonwealth. Such transfer could happen as early as 20 years from the date of project closure. This is a significant departure from the original AGS position that common law liabilities should lie where they fall.

The Coalition amendment provides that long-term liability may be transferred via an indemnity from the Commonwealth in favour of an existing person where: