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Sunday, June 16, 2024

Equinor gives up drilling down under

After years of massive protests that also hurt Norway’s national reputation, state oil company Equinor is dropping plans to drill for oil and gas off the southern Australian coast. Environmentalists, climate activists and local surfers were jubilant, even though Equinor cited purely commercial reasons for its decision.

The Great Australian Bight, a protected marine area off this southern coast of Australia called the Bunda Cliffs, will be spared from oil drilling by Norwegian oil company Equinor. It’s dropping oil exploration plans in the Bight, not necessarily because of massive opposition from local residents and environmentalists, but because the drilling plans are now viewed as “not commercially competitive.” Whales and other protected maritime life flourish in the area. PHOTO: Greenpeace/Jaimen Hudson

“Following a holistic review of its exploration portfolio,” reads a statement from the Norwegian oil company, “Equinor has concluded that the (Australian offshore) project’s potential is not commercially competitive compared with other exploration opportunities in the company.”

The project, initiated when Equinor was still named Statoil, has been among its most hotly contested and controversial oil exploration and production projects. It involved drilling for oil in the Great Australian Bight, some of the stormiest seas in the world that are home to many threatened maritime species and located off a scenic coastline.

The Norwegian company’s plans were strongly opposed by the local Australian fishing and tourism industries, residents, surfers, environmental organizations and indigenous peoples. They’ve been mostly concerned over the potential for oil production and oil spills, while the deadly and destructive climate-related forest fires that have recently been plaguing Australia ignited additional concern and fueled more opposition to ongoing exploration for a product that generates carbon emissions.

‘Fantastic news’
Opponents were celebrating Equinor’s withdrawal on Tuesday. “This is fantastic news and a great victory for the world’s climate and the vulnerable natural environment in the Great Australian Bight,” said Aud Hegli Nordø of Greenpeace Norway. “It’s good to see that Equinor has done the only right thing.”

Australian surfers and activists Anna Taylor and Tim Jones, who’ve been fighting Equinor’s plans for three years, were jubilant as well. “Oh, it was so wonderful when the mayor here came out and told us that Equinor was pulling out,” Jones told news bureau NTB. “The phone hasn’t stopped ringing. This is just fantastic, a great burden has been taken off our shoulders.”

Marine ecologists Georgina Wood and Sam Owen, during a Greenpeace demonstration against oil drilling plans in the Great Australian Bight, here off Kangaroo Island. PHOTO: Greenpeace

The surfers and other activists have been holding demonstrations all over Australia and even took their battle to Norway last year when Equinor held its annual shareholders meeting. They paddled around in the Oslo Fjord and let it be known that the Norwegian company and Norwegian government owning Equinor were not popular back home.

Both BP and Chevron had already pulled out of the Bight. Equinor took over their licenses but has now also decided “to discontinue the exploration program” off Australia’s southern coast while maintaining an exploration permit off Western Australia.

Equinor’s country manager in Australia, Jone Strangeland, claimed that Australian regulatory approval of the company’s proposed drilling project “confirmed our ability to safely operate in the Bight.” The regulatory approval, however, had been challenged by The Wilderness Society, which sued the Australian petroleum authority in January. It claimed Equinor had neglected to consult both local authorities and the local indigenous population.

Equinor made no mention of the lawsuit in its statement, nor any clear public concessions that all the opposition mattered, stressing simply that “the opportunity (in the Bight) is not commercially competitive.” Nordø of Greenpeace, though, is quite certain that the opposition did matter after all: “Equinor has experienced enormous and well-deserved pressure.”

Equinor defends international operations
The Norwegian oil company’s international operations have been the target of more criticism lately, not only because many have generated large losses but also because of their negative environmental impact. Statoil/Equinor’s ill-fated tar sands venture in Alberta, Canada was also highly controversial, as is its fracking activity in the US and various projects off Angola and Brazil. A Member of Parliament for the Socialist Left party (SV) recently called for selling off Equinor’s international portfolio, while also suggesting that Equinor’s environmental standards abroad are lower than they are on the Norwegian Continental Shelf.

SV has not won sufficient political support for its initiative and Equinor has defended its international operations. Torgrim Reitan, a top Equinor executive in charge of international development and production, wrote in a commentary in newspaper Dagens Næringsliv (DN) last week that “it’s a strength” for Equinor to “have more legs to stand on” than just those in Norway. Reitan also argued that many of Statoil/Equinor’s operations abroad have been profitable, with proceeds now being invested in renewable energy projects.

The company’s international presence has also helped Equinor become “one of the world’s largest companies in the wind energy sector,” while the company has “built our first solar energy park in Brazil and started building another in Argentina.” Reitan noted that Statoil/Equinor has benefited from its international experience. He didn’t mention the Australian project, claiming instead that “the world’s energy systems are changing, and we’re only at the start of this global reorganization.” Berglund



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