The Labor government’s quiet betrayal of the Commonwealth

The extension of the North West Shelf project isn’t just another economic blunder – it’s a decision that sacrifices climate commitments, Indigenous heritage and the interests of future generations.

The Woodside North West Shelf project. Photo credit: Woodside Energy.

During the recent federal election campaign, climate change barely rated a mention – and it seems that this omission suited the Labor government perfectly, as any meaningful discussion would have exposed the uncomfortable reality of Australia’s weak environmental credentials: despite a legislated target to cut emissions by 43 per cent below 2005 levels by 2030, the country is not on track to meet this goal, and there’s less than five years to go. The omission also meant the government could avoid questions about its approvals for a wave of new coal and gas projects during the last term, quietly enabling the fossil fuel industry to expand while presenting itself as a supposedly responsible climate actor.

Perhaps the most egregious example of this contradiction is the recent decision to extend the licence for the North West Shelf gas project – Australia’s largest fossil fuel operation – until 2070, another 40 years. Of course, the delay was a deliberate decision: the government extended this licence after the election, because it knew that it would have been political toxic to announce it before or during the campaign. The current licence was due to expire in 2030, and there were expectations that the project would begin to wind down, so the Labor government could meet climate targets and provide for a transition away from gas. Instead, Australia will depend on more fossil fuels for decades to come, as well as adding around six billion tonnes of emissions into the atmosphere.

For many years, the North West Shelf project has also been Australia’s largest industrial emitter of greenhouse gases and in 2021, accounted for 5 per cent of all emissions in Australia. The extension guarantees that this environmental burden will continue, making a mockery of Australia’s international climate commitments under the Paris Agreement.

And in addition to these emissions, the gas project has already inflicted catastrophic damage on the Burrup Peninsula’s cultural heritage, with more than 5,000 sacred Aboriginal sites destroyed over the past few decades – carelessly and in some cases, deliberately – and the gas plant in Karratha is positioned precariously close to Murujuga rock art, a collection of over a million rock carvings, making it the largest and oldest outdoor art gallery on the planet. These ancient artworks are now threatened by acid emissions, industrial expansion, and the negligence of governments prioritising corporate profits over heritage protection.

This extension also raises serious questions about corruption within Australia’s political system. Aside from its program of ‘sportswashing’ through the AFL’s Fremantle Dockers, Woodside has long been a generous donor to both major parties, and between 2010 and 2025, it contributed over $5 million to the Liberal and Labor parties – an investment that, for the company, has obviously paid off handsomely. This is just one in a series of decisions where government approvals for fossil fuel projects have been linked to political donations, exemptions from regulations, and a revolving door of former politicians and bureaucrats joining the fossil fuel sector as consultants or lobbyists. The Labor government’s approval of this extension after the election – made with almost no public consultation and very little transparency – erodes public trust in Australia’s democratic institutions and shows how much influence fossil fuel interests have within local politics.

Australia has committed to net zero emissions by 2050, yet this single project will continue to emit greenhouse gases into the atmosphere well beyond that date, undermining the national and global efforts to reduce the effects of climate change. This isn’t just a policy decision – it is a choice to sacrifice environmental integrity, cultural heritage, and the wellbeing of future generations in favour of short-term political convenience and corporate profits. And it’s obvious that the Labor government with its freshly minted 50-seat majority in Parliament, despite its rhetoric on climate action, has made its priorities very clear for the next term.

The fire sale of resources: How Australia’s gas wealth is squandered

Aside from the environmental scandal, the extension of the North West Shelf gas project is also a monumental economic failure. For years, Australia has practically given away its vast mineral and energy resources, collecting only a fraction of the revenue that other gas-rich nations extract from the same industry. The Labor government, in approving this extension and maintaining a broken tax regime, is continuing the very practices it once condemned when the Coalition was in power: the quiet, ongoing sell-off of national resources to corporate interests for next to nothing.

During 2023–24, the Australian government collected $1.1 billion on natural gas exports of $70 billion through the petroleum resource rent tax, a tax which was created to supposedly collect a fair share of profit from the non-renewable resources sector. This is less than 1.5 per cent of the value of the gas. In contrast, Qatar had a similar level of exports – 77 million tonnes, versus Australia’s 84 million tonnes – yet collected $26 billion in royalties, or almost 26 times more.

To add further insult to injury, around 80 per cent of Australia’s LNG is shipped overseas, with no royalties paid on around 56 per cent of this gas. In effect, vast quantities of the country’s natural wealth are being extracted, processed, and sold for massive profits by multinational energy companies, while the Australian public sees almost none of the benefits. The government’s own reports have repeatedly shown that the current resource rent tax system has too many loopholes that allow gas giants such as Woodside, Santos, and Chevron to offset their profits through deductions, inflate development costs, and avoid paying a meaningful share back to the Australian people.

Defenders of this ludicrous arrangement – primarily from the resources industry – argue that raising royalties or closing tax loopholes would scare off investment, yet Qatar imposes far higher tax rates and royalty charges on its gas sector, and its industry is booming. In fact, Qatar has successfully leveraged its gas wealth to fund social services, infrastructure, and economic diversification, while Australia has let its own gas boom become a profit bonanza for corporations and shareholders.

The North West Shelf extension, and the failure of resource taxation and royalty scheme represents a historically and monumental failure of government. It’s a case study in how public resources are transferred to private hands with next to no benefit to the nation. The Labor government, like its Coalition predecessors, has perpetuated this model: approving projects that lock in fossil fuel dependency, while ensuring that the financial windfall flows almost entirely to industry, and not to the public. At a time when governments around the world are rethinking resource taxation in the face of climate change – as well as addressing higher levels of public debt – Australia has signed away its wealth for another 40 years and undermined its own environmental commitments.

Australia’s economic and environmental sacrifice at the altar of corporate greed

The seeds of Australia’s gas disaster were planted many decades ago. The North West Shelf project – established in the early 1980s – was supposed to capitalise on the nation’s vast gas reserves, primarily for export. The first shipments of liquefied natural gas left for Japan in 1989, but even then, the royalty and tax arrangements were hopelessly inadequate. The most ridiculous deal, however, came in 2002: a long-term contract facilitated by the Howard government to supply three million tonnes of LNG per year to China, worth $25 billion over 25 years – roughly $700 million to $1 billion per year, with prices locked in until 2031, with no increases allowed, no matter how much global LNG prices surged.

By 2015, the absurd nature of the deal became obvious: as international LNG prices kept on skyrocketing, Chinese buyers were paying around one-third of what Australian domestic consumers were forced to pay for the same gas, and from the same market. The situation was so ludicrous that Australian companies were buying back their own gas – and still doing so – from overseas markets in Japan and South Korea because it was cheaper than purchasing it domestically. It is, without a doubt, one of the worst commercial deals ever signed off by an Australian government – locking the nation into decades of underpriced exports while Australians faced rising energy costs at home.

In 2019, Woodside, along with its joint venture partners – Chevron, Shell, BP, and Mi/Mi – formally proposed to extend the life of the project, including the Karratha gas plant. Despite widespread warnings from scientists and environmentalists that have been provided over the past six years, the project has now been approved by the new Minister for the Environment, Senator Murray Watt. Independent analyses suggests that due to the additional six billion tonnes of greenhouse gases released over its lifetime, this will make it almost impossible for Australia to achieve net-zero emissions by 2050.

This approval is a betrayal by the Labor government – a sell-out of both the environment and Australia’s economic future. Labor was swept into office in 2022 on the back of promises made on climate action and renewable energy investments but it has reneged on so many of these promises. The government also abandoned plans to establish a federal Environmental Protection Agency in the lead-up to the Western Australian state election, fearing a backlash from powerful fossil fuel interests, and since its election in 2022, it has approved new gas fields, new coal mines, and now this – an extension of a project that locks in decades of carbon pollution, both here and internationally. And this is in the context of Australia already feeling the consequences of climate inaction: a summer of record-breaking heat, unprecedented cyclones battering Queensland, and severe flooding for New South Wales.

It’s a strange political dissonance and surely one that will catch up with the government at some point, despite the fact that they’re up against a weak Coalition opposition. It’s becoming clear, however, that this government, despite its promises, is not serious about climate change. There’s the ongoing rhetoric, but it continues to prioritise short-term fossil fuel profits over long-term environmental survival and economic fairness. The extension of this project is not just another economic blunder on behalf of the Commonwealth – it’s a deliberate decision to sacrifice Australia’s climate commitments, its Indigenous cultural heritage, and the interests of future generations for the sake of corporate greed. And once again, it’s the public who will pay the price: through higher energy costs, a destabilised climate, and the irreversible loss of the nation’s natural and cultural treasures.