Industry backlash over hidden carbon capture tax after plans were accidentally revealed online

Major gas producers are demanding answers after plans for a levy on companies injecting carbon dioxide into the ground were accidentally revealed on a State Government website. Opposition Leader Shane Love accused the Government of a “blatant broken promise” just three weeks after Premier Roger Cook vowed there will be “no new mining taxes” under his watch. The Towards 2029 strategy on the Department of Energy, Mines, Industry Regulation and Safety lists “implementation of a CO2 injection levy” as a priority of a 2024-25 focus, with a proposed time frame of one to five years. “This is a direct betrayal of trust and a clear warning that Labor cannot be relied upon when it comes to taxes and levies targeting WA’s mining and resources sector,” Mr Love said. US-owned Chevron, which operates one of the world’s largest carbon capture and storage projects on Barrow Island, was quick to warn about “unintended consequences” if the levy went ahead. “We have heard the WA Government is considering options to introduce a petroleum rehabilitation fund and a CO2 injection levy,” a Chevron Australia spokesperson said. “While we support well designed policy that ensures companies are responsible for their own infrastructure and that they decommission responsibly, we are keen to gain a greater understanding of the proposals and to have the opportunity to provide input. “We hope any proposals avoid unintended negative consequences including penalising responsible resource holders for the failings of others.” American oil and gas company APA Corporation announced it would cease operations in the UK North Sea, after authorities there announced plans for a “user pays” carbon storage levy in May. Mr Love said the Government should be supporting industry through the energy transition rather than “proposing a punitive tax on carbon sequestration, a vital tool for emissions reduction”. “The Cook Labor Government must immediately back down from this proposal and provide unequivocal assurances to the industry and Western Australians that this tax will not proceed,” he added. The State Government did, within hours of being contacted by The West Australian. But the Government could not explain the document, that remained online. “The Cook Government is committed to attracting (carbon capture) projects to WA, and has no plans to introduce any levies on CCUS projects,” a spokesperson said. The Government will on Thursday release its Carbon Capture, Utilisation and Storage plan and announce a funding boost for two projects. A $15 million grant will go towards a transmission pipeline on the Burrup Peninsula, where producers are aiming to collect up to five million tonnes of carbon dioxide. Another $11 million will support Japanese-linked company Mitsui’s Cygnus hub in the Mid West, which is aiming to store about 530 kilotonnes of CO2 per annum. Mr Cook described carbon capture technology as a vital part of the climate change solution. “CCUS will play an important role for hard to abate industries and we’re positioning WA as a world leader,” he said. “WA has the skills, the infrastructure and the natural features to attract major global investment into CCUS, helping to diversify our economy, create local jobs and supporting our low-carbon future.” CCUS projects proposed in WA over the next decade have the potential to store over 20 million tonnes, or around a quarter of the State’s carbon emissions, per year. But the technology is still being developed and has previously failed to meet targets. The Government said its action plan will enhance policy certainty, attract investment and accelerate the development of technology and infrastructure.