Summary
In late June DCCEEW released draft Guidance in relation to regulating the offshore sequestration of CO₂ under the Environment Protection (Sea Dumping) Act 1981 (Cth) (Sea Dumping Act).
It is recognised that CCS has an important role to play in decarbonizing hard to abate industrial sectors and reducing emissions of major energy emitters such as LNG projects. Offshore CCS projects that use depleted gas formations are expected to bring an additional benefit of large scale and the capacity to make material reductions in CO₂ emissions.
There are several CCS projects in the pre- development phase in Australia that will require permits under the Sea Dumping Act, as well as other customary environmental and operating approvals.
Australia must have an internationally compliant and robust regulatory framework in order for these projects to be advanced. Concerns have, however, been expressed that the measures proposed in the consultation materials are out of step with the approaches being taken by other jurisdictions. A fear is that they will create schedule and execution risk for the proponents of CCS projects, who may not be able to mature and develop their projects in a timely and certain way to modify their facilities or meet customer demand.
Below is a summary of these consultation materials, which includes some very high-level observations as to its impacts and overlap with Australia's existing offshore legislation.
DCCEEW are seeking feedback on the materials by Friday 12 September 2025.
DCCEEW Consultation Materials
On 27 June 2025, the Department of Climate Change, Energy, the Environment and Water (DCCEEW) released consultation documents relating to the regulation of the offshore sequestration of domestically sourced CO₂ under the Sea Dumping Act. They comprise the draft Offshore CCS National Action List (NAL), the National Assessment Guidelines (Guidelines), and an updated Sea Dumping permit application form (together, Consultation Materials).
Background – CCS Regulation in Australia
Carbon capture and storage is an acknowledged vehicle to address climate change through mitigating fossil fuel (CO₂) emissions by injection and permanent storage of captured CO₂ product streams in underground formations. While the Gorgon CCS project located in Western Australia is the world's largest CCS project, the technology has not been widely deployed in Australia.
Australia's National Greenhouse and Energy Reporting (Safeguard Mechanism) Rules 2015 and related legislation house the Commonwealth government's policy to reduce CO₂ emissions from Australia's largest facilities by instituting emission baselines for those facilities, which progressively decline each year. These reductions aid Australia in meeting its emissions reduction targets. As a mechanism to permanently store CO₂, CCS is an attractive option for large emitters to reduce their CO₂ emissions and meet their annual target under the Safeguard Mechanism. Failure to do so results in significant extra costs.
Australia specifically regulates the offshore disposal of Carbon Dioxide (CO₂) through the:
- Sea Dumping Act, which gives effect to its obligations under the London Protocol and which is regulated by DCCEEW. The objective of the London Protocol is to control and minimise the disposal of waste at sea through the use of a permissioning control; and
- Offshore Petroleum and Greenhouse Gas Storage Act 2006 (Cth) and associated regulations (OPGGSA) which is the primary permissioning legislation for undertaking CCS operations in Commonwealth waters and which is supervised by NOPTA and NOPSEMA.
Authorities under both Acts are required before CCS operations can commence.
Generally, the Sea Dumping Act seeks to control and minimise the disposition of waste material in Australia's marine environment and does so by requiring a permit to be secured before any material, including CO₂ can be dumped. To secure a Sea Dumping permit, an applicant must detail:
- its process and controls for the operation, including location;
- the nature and quantity of the material involved;
- its assessment of the potential implications for human health and the marine environment arising from the waste disposition and the operation itself; and
- the measures used to minimise the waste creation and its investigations of alternative disposition.
There is much global activity aimed at developing industrial scale CCS projects, with many countries providing extensive governmental encouragement and financial support to this nascent industry. Understandably, aspects of these policies do not sit easily with a legislative requirement that is intended to generally control and minimise an activity (e.g. disposition of wastes at sea). Some of these tensions are evident in the Consultation Materials.
Observations
Below we provide a brief summary of the Consultation Materials, including some high-level observations. The Consultation Materials are extensive and demonstrate the comprehensive nature of information that DCCEEW will seek in order to assess an application for a Sea Dumping permit. Given this level of detail, a 3 month period is provided for feedback.
Potential Regulatory Overlap
There are elements of overlap between the Consultation Materials and the OPGGSA, with the OPGGSA already covering a significant proportion of the requirements proposed by the Sea Dumping regime.
Our admittedly, non-technical, view is that much of the criteria covered by the OPGGSA processes will need to be re-reviewed and assessed under the regulatory framework proposed by the Consultation Materials and this is something that project proponents should closely assess.
We note that the Government has referenced the interaction between the relevant authorities, however, harmonisation or accreditation of prior approval processes is not considered or addressed.1
Timing
As noted above, the planning and assessment requirements under the Guidelines appear to significantly overlap with the processes required under the OPGGSA.2 Approvals under the OPGGSA such as early notification of applicable storage formations, their suitability, and ultimately a declaration of formation storage (DOS), are comprehensive. Most proponents managing a Sea Dumping permit application, will already have been successful in obtaining OPGGSA-related approvals and licences.3 As DCCEEW through the Guidelines seek to understand and approve site selections and subsurface suitability, much of the same information will need to be resubmitted and there is the possibility that previous approvals / decisions could be reopened. Additionally, the timelines remain uncertain, for commencement of the Sea Dumping permit process assumes detailed information on the product stream will be available, with separate applications for any new sourced stream.4
Applications are unable to be amended after submission.5 Given the extensive and technical detail required in the Sea Dumping permit application, proponents should consider whether more justification is needed to support this stance.
Monitoring and Risk Assessment
The Guidelines create new obligations in relation to monitoring of CCS operations. How these sit with the extensive supervisory powers held by the regulators under the OPGGSA is not clear. There is extremely targeted formation monitoring pre and post project closure provided for under the OPGGSA, with an ultimate indemnity and handover to the Commonwealth Government.6
A Sea Dumping permit can be conditioned with the obligation to implement risk assessment processes on top of those primarily controlled by NOPSEMA under the OPGGSA.7 These include managing unintended releases which is the subject of detailed environmental, development, well and pipeline planning instruments under the OPGGSA. These measures potentially create overlapping and inconsistent obligations with those in the OPGGSA.
Waste management
The waste management audit requirements in the Guidelines are underpinned by a requirement that all alternatives to prevent the waste and its management have been explored. Page 23 sets out a detailed stepped workflow for applicants to use. It is directed at activities that originally source the CO₂ streams, even though in many instances in Australia it will be persons other than the applicant whose business activity will result in the CO₂ product stream that is being stored.8
Section 2 of the 2012 Specific Guidelines for Assessment of Carbon Dioxide Streams for Disposal into Sub-seabed Geological Formations (2012 Guidelines) questions the need for such audits noting that they are not directly pertinent to CO₂ sequestration.9 For transborder projects the requirement seems irrelevant, being a matter for the source country, and appears at cross purposes with CCS projects operating as a business services model for the reduction of emissions.
National Action List
A requirement of the London Protocol is a national action list, intended to be a screening tool to assess the suitability for the disposal of waste (CO₂ stream) at sea, and to outline acceptable concentrations of impurities and the potential effects on the marine environment and human health.
Before granting a Sea Dumping permit, the Minister must be satisfied that the CO₂ stream and incidental associated substances (IAS) (minor components arising from the source material or capture process) meet the criteria set out in the NAL.10
The draft NAL in the Consultation Materials will influence how Sea Dumping permit applications are prepared and assessed. Proponents should consider:
- how realistic are the ranges in the NAL;
- should the NAL recognise that a CCS operation is a closed system, with no waste interface with the marine environment in normal operations;
- that each CO₂ stream must be assessed separately;
- departures from the NAL risk a cessation of operations;
- blending or quality evolutions may require a new application;
- justification for any limits prescribed in the NAL are stricter than those proposed by other jurisdictions, which may be a competitive disadvantage for CCS marketing activities; and
- if the NAL limits are too "tight" then the Sea Dumping permit may not be issued in the ordinary course and may require a bespoke decision.
Other Government Regulatory Initiatives
There has been no reported outcome (at least as far as we are aware) from the DISER review of the CCS regulatory system announced in the 2023 budget, that recognised the need for an efficient and fit for purpose system of regulation. There appears to be no intent in the Consultation Materials to simplify the regulatory environment for CCS projects in Australia. This includes no consideration at this stage of the additional potential overlap with the Environmental Protection and Biodiversity Conservation Act 1999 (Cth).
Conclusion
The LNG and natural gas sector is actively pursuing CCS storage in offshore areas including in areas near to their existing operations. Recognising that Australia seeks to urgently bring on new sources of gas supply as part of its Future Gas Strategy, developing CCS facilities in parallel and in a timely way is critical for these new gas projects.11 It will help proponents meet their safeguard obligations as well as allowing the marketing of lower carbon product streams. It is important that the required approval and permitting processes under all applicable regulatory regimes facilitate CCS developments and do not have the unintended consequence of impeding or delaying the future gas policy initiative.
Accordingly, the release of the Consultation Materials is timely and show the DCCEEW's perspective of how the Sea Dumping Act elements of CCS operations ought to be regulated. We anticipate that the Consultation Materials will be subject to close scrutiny by proponents through the lens of schedule impacts, proportionality and duplicative process and cost.
The DCCEEW are seeking feedback on the Consultation Materials until 5pm, Friday 12 September 2025.
Footnotes
1. Offshore Carbon Capture and Storage Regulatory Approvals, pages 4 and 5 and National Assessment Guidelines for Offshore Carbon Capture and Sequestration page 7.
2. National Assessment Guidelines for Offshore Carbon Capture and Sequestration, section 1.1.
3. National Assessment Guidelines for Offshore Carbon Capture and Sequestration, section 5.
4. National Assessment Guidelines for Offshore Carbon Capture and Sequestration, section 1.3.
5. National Assessment Guidelines for Offshore Carbon Capture and Sequestration, page 11.
6. National Assessment Guidelines for Offshore Carbon Capture and Sequestration, section 1.5.
7. National Assessment Guidelines for Offshore Carbon Capture and Sequestration, section 6.1.
8. National Assessment Guidelines for Offshore Carbon Capture and Sequestration, section 4.
9. 2012 Specific Guidelines for Assessment of Carbon Dioxide Streams for Disposal into Sub-seabed Geological Formations, section 2.
10. Offshore Carbon Capture and Sequestration National Action List, page 5.
11. Extract from p 3 DCCEEW safeguard-mechanism-reforms-factsheet-2023.pdf; highlights the criticality of CCS for expansion projects - New gas fields supplying liquefied natural gas facilities will be given a zero baseline allocation for the reservoir CO2 in their new fields, given the existence of low-CO2 fields and opportunities for carbon capture and storage.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
