Otway

Otway is a oil & gas facility operated by BEACH ENERGY LIMITED in VIC. Like all covered facilities, LNG processing, gas extraction and pipeline operations release methane and combustion emissions. Under Australia's Safeguard Mechanism, Otway must keep its annual emissions below a stepping-down baseline — or purchase carbon credits to cover any overage.

In 2023–24, Otway reported emissions of 157 kt against a baseline obligation of 128 kt — an overage of 30 kt. The facility covered the overage through a combination of ACCUs and SMCs.

Purchasing credits is legal and intended by the Safeguard Mechanism's design — the policy deliberately allows facilities to choose between cutting on-site emissions or funding abatement elsewhere in the economy. Whether credit purchases represent genuine long-term decarbonisation depends on whether the facility's absolute emissions are trending down over time. The chart above shows the trajectory since reporting began. This question applies to all covered facilities under the Safeguard Mechanism, not Otway specifically.

Across the oil & gas sector, 8 of 8 covered facilities reported emissions above their baseline in 2023–24. The table below compares Otway with other oil & gas facilities covered by the Safeguard Mechanism.