speech business news success and leadership breakfast keynote address
Mark Hatfield - Managing Director, Chevron Australia
Business News Success and Leadership Breakfast
12 July 2023
I’m very pleased to be here today.
I would like to begin by acknowledging the traditional owners of the land we meet on, the Whadjuk people of the Noongar nation, and pay my respects to their Elders past, present and emerging.
And I would like to thank the Business News team for hosting me this morning.
Before I sit down with Mark and answer what I’m told will be many questions, I would like to share a few thoughts about the energy industry.
History tells us that the only constant in the energy system is change.
It’s constantly evolving.
In Australia, Chevron has evolved through our interests and investments we’ve had in this country over the past 70 years.
From discovering oil off the Western Australian coast in the 1950s and joining with others to develop WA’s LNG industry, to pioneering carbon capture and storage, we’ve changed as the world’s energy needs have changed.
Today, we’re one of the largest investors in Australia and proudly operate two of the largest natural resource projects in the country, the Gorgon and Wheatstone natural gas projects, among other interests.
These projects not only provide LNG to international customers – supporting energy security for our region – they also support the development of WA’s economy, having the capacity to produce around 50 percent of the state’s current domestic gas supply.
This is natural gas for electricity, heating and cooking in our homes, and supporting WA’s industries – extracting and processing critical minerals, and manufacturing everyday products including fertilizers, among others.
We are in a unique position in Western Australia to contribute solutions to global conversations and challenges.
We’re years into a multi-decade period of transition that is grappling with a two-sided challenge for the energy system:
- improving energy access for everyone, and
- reducing the impact on the environment.
Take the fact that there are about eight billion people on the planet today, with 10 billion expected 25 years from now.
We need to support the progress and prosperity of everyone.
Progress and prosperity depend on scalable energy solutions and innovations that are not only lower carbon, they are also affordable, reliable and accessible to people all over the world.
To achieve our goals and ensure we’re able to keep the lights on, we must acknowledge and balance the priorities of reliable, affordable, and ever cleaner… to create a future of energy that works for all.
Because the energy transition will occur at different paces, in different places.
Currently, WA is the largest consumer of natural gas in Australia. Consuming almost as much gas as Queensland, New South Wales and Victoria combined – largely driven by the mining and minerals sector.1
A recent report from the Australian Energy Market Operator says overall WA domestic gas demand is forecast to grow at an annual rate of 1.7 percent for years to come.2
When looking at electricity generation in WA, natural gas will play a key role into the 2040s.
The WA Government forecasts a near ten-fold increase in total electricity generation and storage capacity for Perth and southwest, with renewables projected to only partly replace coal, as coal-fired power plants are phased-out.3
To meet this increase in demand, new gas supplies will be needed to supplement intermittent renewable energy – so WA households and industry can continue to enjoy reliable and consistent electricity supply.
More broadly in the Asia Pacific, demand for regional domestic and industrial energy is forecast to grow by almost two-thirds by 2040.
These forecasts outline that natural gas will continue supporting the state’s economy and those of our closest neighbors and trading partners, for a long time to come.
But Chevron believes this is an… and… discussion.
Providing reliable, affordable traditional energy... and... developing lower carbon energy solutions.
We are working to lower the carbon intensity of our operations and grow lower carbon businesses.
Our effort in Western Australia so far includes the Gorgon Carbon Capture and Storage system – or CCS – which has safely stored over eight million tonnes of CO2 since mid-2019.
It’s fair to say Gorgon CCS isn’t where we want it to be, but the system works.
It is storing carbon dioxide every day on a global scale.
WA also has the elements to be leading provider of CCS solutions for the region, and every effort should be made to support this potential growth industry for the state.
In addition to CCS, we use verifiable offsets, and we’re exploring technical abatement solutions that can be developed and deployed at scale at our facilities.
All of this as we pursue our scope one net zero aspirations.
The lower carbon challenge is significant. But we have the commitment, skills and talent needed to find solutions.
Addressing the complex energy issues that we face today can’t be done by one country, or one company, or one industry alone.
Meeting a growing world’s need for more energy, and more lower carbon options, is our profound responsibility.
People deserve affordable energy to create prosperity; reliable energy that supports their national security; and ever-cleaner energy that protects the environment.
There is no doubt the expectations of our industry are changing, and we need to keep evolving if we’re to meet those expectations.
- 2022 Western Australia Gas Statement of Opportunities: Market Outlook to 2032
Australian Energy Market Operator (AEMO)
- Australian Energy Statistics: Australian energy consumption in 2020-21, by state and territory, by industry, selected fuels, energy units
Australian Government, Department of Climate Change, Energy, the Environment and Water, Australian Energy Statistics
- SWIS Demand Assessment 2023 to 2042: A future ready grid
Government of Western Australia, Department of Mines, Industry Regulation and Safety