Economic and Environmental Concerns Raised
The National Offshore Petroleum Safety and Management Authority (NOPSEMA) has approved an environmental plan that allows ExxonMobil Australia and Woodside to delay the removal of oil and gas infrastructure in the Bass Strait. This decision permits tens of thousands of tonnes of steel to remain on the seabed until 2032, despite potential economic benefits from recycling.
Environmental groups and industry experts have criticised the decision, arguing it represents a missed economic opportunity and highlights a regulatory weakness. Friends of the Earth Melbourne condemned the move, stating it permits the Joint Venture to neglect timely decommissioning. Stan Woodhouse, a campaigner for Friends of the Earth, stated, “The clean-up of the Joint Venture’s Bass Strait assets has already seen endless delays due to corporate irresponsibility and inaction by the regulator. This latest decision misses an opportunity to take advantage of a remarkable vessel designed for exactly this work.”
Regulatory and Economic Implications
The Pioneering Spirit, a purpose-built rig-removing vessel, is planned to arrive in Australia in the summer of 2027/28 for the initial phase of decommissioning. Despite this, the current plan allows for the postponement of removing lower steel pile jackets until 2032, while the nation’s steel recycling industry suffers from a lack of domestic feedstock. The Australian Steel Institute testified in a Victorian parliamentary inquiry that domestic steel recycling is currently reliant on imported scrap steel.
The Offshore Petroleum and Greenhouse Gas Storage Act mandates the full removal of infrastructure as the legal base case post-production. ExxonMobil has indicated its intention to apply for permanent abandonment of the steel structures later this year, further complicating the issue. Woodhouse further highlighted the broader implications, stating, “Australia needs steel for public works and the transition to renewable energy. NOPSEMA should be maximising opportunities for the circular economy, not protecting ExxonMobil’s shareholder returns.”
Concerns about the importation of scrap steel due to domestic shortages have already been heard by a Victorian parliamentary inquiry into decommissioning. The Joint Venture’s actions could exacerbate this situation by leaving valuable resources unused. Anticipation surrounds the arrival of the Pioneering Spirit in Australian waters, marking a critical juncture in the decommissioning process. However, NOPSEMA’s decision raises questions about the regulatory framework governing offshore petroleum activities.
According to a bulletin released by ExxonMobil in March 2026, they plan to apply for the permanent abandonment of the lower steel pile jackets by the fourth quarter of the year. This move has been met with resistance from environmental advocates who argue for the removal and recycling of these materials instead.
Last updated: 4 May 2026, 8:19 pm
