Varanus Hub

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

In 2023–24, Varanus Hub reported emissions of 281 kt against a baseline obligation of 237 kt — an overage of 44 kt. The facility covered the 44 kt overage by purchasing 43,802 Australian Carbon Credit Units (ACCUs) — credits generated by carbon abatement projects elsewhere in Australia such as soil carbon farming, avoided land clearing, and landfill gas capture.

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 Varanus Hub specifically.

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