Safeguard deal won't affect Scarborough gas: McGowan

A Federal climate deal struck between Labor and the Greens won’t impact major gas projects such as Scarborough, WA Premier Mark McGowan says.

Laws enabling an overhaul of the safeguard mechanism are expected to pass Parliament this week with the backing of the Greens and crossbenchers.

Labor secured the support of the Greens after agreeing to amendments placing a ceiling on gross greenhouse gas emissions and requiring new or expanded projects to be tested for their impact on carbon budgets.

Greens leader Adam Bandt has said the amendments mean new fossil fuel projects will be less likely to go ahead.

But Mr McGowan said he had been informed Woodside’s massive Scarborough LNG project, which is targeting first production in 2026 but subject to legal challenges, wouldn’t be affected.

“All the advice I have is it doesn’t impact our gas projects because their direct emissions are currently offset or they’re low-emission projects,” he told Perth radio 6PR.

“I spoke to (Federal Climate Change Minister Chris Bowen) on Sunday. He’s been in contact with the major companies as well and is of the view that it won’t impact those projects, in particular Scarborough.”

The safeguard mechanism, which was initiated by the coalition government but is being overhauled by Labor, will apply to the country’s 215 biggest emitters and force them to reduce their emissions by 4.9 per cent each year.

It allows companies that are unable to meet targets to buy carbon credits.

Mr McGowan expected the cost of major projects could increase because of the policy’s requirements but said it was necessary to bring down emissions.

WA’s Government is aiming to reduce its own emissions by 80 per cent below 2020 levels by the end of the decade and has outlined plans to retire State-owned coal-fired power plants during the same period.

It is targeting net-zero emissions across the State economy by 2050.

A Woodside spokeswoman said the safeguard mechanism amendments acknowledged the role of gas and carbon capture and storage in “maintaining Australia’s competitiveness in a decarbonising economy”.

“Australia needs to find a way forward to ensure there is investment certainty for the businesses that are committed to the nation’s emissions reduction goals and that drive our economy via domestic gas, tax revenue and raw materials for manufacturing,” she said.