OFFSHORE GAS STORAGE in underground reservoirs will now be possible off the coast of Gippsland following the passage of enabling legislation through the Victorian Parliament.

The Offshore Petroleum and Greenhouse Gas Storage Amendment Bill 2024 supports the development of additional gas storage capability to help maintain secure and reliable gas supply as Victoria progresses to 95% renewable electricity by 2035, the state government says.

This legislative change mean gas can now be stored offshore in underground reservoirs deep in rock layers, where it formed naturally before being extracted, and can be made available when and where it is most needed.

This will reduce Victoria’s exposure to swings in gas prices during periods of high demand and will provide secure supply for gas-powered electricity generators to balance the electricity system when required, Minister for Energy and Resources Lily D’Ambrosio said.

One proposed offshore gas storage project – which is approved – could provide approximately 12.5 petajoules of additional gas storage, increasing Victoria’s storage capacity by almost 50%.

The Golden Beach Energy Storage Project, developed by GB Energy, will become Victoria’s first offshore gas storage facility. It will be located off the coast of Gippsland has already undergone a rigorous Environment Effects Statement process that included public consultation and can now progress to final investment stage. 

The jack-up rig Valaris 107, which this week returned to Bass Strait to undertake decommissioning work for Esso Australia (DCN 25 October) previously drilled a carbon capture and storage appraisal well for the Golden Beach Energy Storage project in 2023.

The Golden Beach Gas Project will complete an initial short period of production before it can be transitioned to a storage facility. The project is expected to deliver 30 petajoules of gas for the domestic market over a year from winter 2027 – this about a quarter of Victoria’s annual household and small business consumption. 

“We’re ensuring a safe and reliable energy supply is maintained as we get on and build the renewable energy of the future and work towards net zero emissions by 2045,” Ms D’Ambrosio said. “We’ve just unlocked new offshore gas storage projects that will be critical to helping us keep the lights on, protect consumers from high energy prices and support industry through the transition.”