“An extraordinary 24 hours,” said Dan Gocher of the Australasian Centre for Corporate Responsibility,a shareholder activist group. “It will have massive implications for the Australian oil and gas industry.”
Credit Suisse energy analyst Saul Kavonic said the investment bank believed the most likely fallout for the industry in Australia was the intensifying climate pressure leading to a sector-wide spending pull-back from major companies.
This risk,he added,would be compounded by the International Energy Agency’s latest findings that investors should not fund any new oil and gas fields if the world is to achieve the Paris agreement’s aspirational target of limiting global temperature rises to 1.5 degrees above pre-industrial levels.
“We see increased risk that further caution and scrutiny may be applied towards deploying more oil and gas capital expenditure by some of the larger listed oil and gas companies,” Mr Kavonic said.
Although this may benefit the supply-and-demand dynamics for Australian producers,the more “limited buyer pool” could imperil plans by ASX-listed Woodside,Oil Search and Santos to sell stakes in their projects in Australia and overseas.
In addition,it could also pose a risk to Australian companies partnering with major US or European companies on developing new oil and gas projects that are yet to receive the financial go-ahead,Mr Kavonic said.
Industry representatives for oil and gas producers on Thursday said Australian companies were doing “heavy lifting” in the decarbonisation push by producing and shipping natural gas – a comparatively cleaner alternative energy source than coal that was displacing coal power around the world.