Industry maps 'net-zero' future for gas supply, exports

Gas producers have mapped nine industrial zones to "carpool" greenhouse gas emissions and give the sector a future in a net-zero economy.

Using shared transmission and pipelines, the zones proposed in a new report would plug gas, renewable energy, carbon capture, and hydrogen production into manufacturing, refineries and new industries.

Australian Petroleum Production and Exploration Association (APPEA) chief executive Samantha McCulloch said the "net-zero zones" would help accelerate change.

"In a way, it's like carpooling carbon emissions by working together to help achieve net zero in the fastest and most cost-efficient way for the economy," she said.

The future industrial heartlands include Adelaide-Port Augusta and the Cooper Basin in South Australia, two in WA - Perth and the Pilbara, and Melbourne-Gippsland in southern Victoria.

Taking in vast onshore gas fields, Sydney to Newcastle is the focus in NSW and Brisbane and the Surat Basin in Central Queensland.

The Northern Territory zone includes the 1500-hectare precinct near Darwin, already designated for gas-based industry and home to a Santos liquefied natural gas (LNG) project and the INPEX LNG project.

Ms McCulloch said the nine zones could become magnets for regional investment and jobs in manufacturing and mineral processing.

Wind, solar, carbon storage technologies, and hydrogen made with gas should be used to hit emissions reduction targets, according to APPEA's report.

The zones cover most industrial plants covered by a federal safeguard mechanism that requires their emissions to fall by 4.9 per cent a year.

The proposed zones also include power stations, gas pipelines and LNG processing and export facilities, and carbon capture and storage projects - one operational, one under construction and nine planned.

But some emissions may remain technically challenging or expensive to decarbonise, according to the report.

CSIRO is working with universities and companies on "carbon dioxide removal" methods such as direct air capture and storage and technologies that use bioenergy, which could one day become commercially viable.

The zones also include 74 proposed hydrogen projects and 89 renewable projects.

Hydrogen has the potential to become a major export, generate electricity in transport fuel cells and gas turbines, and a source of high heat needed to make steel and chemicals.

The federal budget last week included $2 billion worth of new production credits on offer to compete with rival subsidies for hydrogen production in the United States and Europe.

But the federal government ruled out gas or coal-derived hydrogen, instead eyeing two or three flagship projects using renewable energy to make green hydrogen.

However, the budget backs gas as "an important part of Australia's energy mix", with funding for a future gas strategy.

Federal Resources Minister Madeleine King, whose father worked at BP's Kwinana oil refinery, will open the APPEA 2023 conference in Adelaide on Tuesday.

Ms King will try to reassure the industry amid a big push on renewables and less generous tax breaks for offshore gas production from July 1.