2008 Western Australian Gas Crisis

2008 Western Australian Gas Crisis

The Western Australian gas crisis was a major disruption to natural gas supply in Western Australia, caused by the rupture of a corroded pipeline and subsequent explosion at a processing plant on Varanus Island, off the state's north west coast on 3 June 2008. The plant, operated by Apache Energy, which normally supplied a third of the state's gas, was shut down for almost two months while a detailed engineering investigation and major repairs were carried out. Gas supply from the plant partially resumed in late August. By mid-October, gas production was running at two-thirds of normal capacity, with 85% of full output restored by December 2008.

In a state heavily reliant on continuous supply of gas for industrial processing, manufacturing, residential use and electricity generation, the sudden loss of almost 35% of gas supply had immediate social impacts, and significant short and long-term economic effects. Many businesses were forced to curtail or cease operations, resulting in workers being stood down or forced to take annual leave, and the government requested that businesses and householders conserve energy usage. An emergency coordination committee of government and industry representatives rationed and redirected remaining gas supply sources. When many large gas users switched to diesel for power generation, the risk of a shortfall in transport fuel led to the federal government authorising the release of emergency fuel reserves stored at the Garden Island naval facility.

The incident raised significant public and political issues related to energy security, adequacy of existing infrastructure, contingency planning, and the role of regulatory agencies. The plant took three months to repair, although partial supplies were restored within six weeks of the explosion. A major investigation was launched by the National Offshore Petroleum Safety Authority (NOPSA), with separate investigations conducted by the plant operator and several other government agencies. NOPSA's report was published on 10 October 2008, and confirmed early suggestions that the explosion was caused by structural failure of the export pipeline due to significant corrosion. A Senate Committee inquiry was established to investigate the economic impacts and the state government's response to the crisis. The committee's report was handed down on 3 December 2008.