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Report: Chevron may pay penalties for carbon emissions from Gorgon LNG plant

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Report: Chevron may pay penalties for carbon emissions from Gorgon LNG plant

Chevron Corp. could be forced to pay penalties for carbon emissions from the Gorgon liquefied natural gas plant in Barrow Island following a recommendation from Western Australia's Environmental Protection Authority, Reuters reported Sept. 26.

The period for the penalties would start from the time it received its operating license in July 2016, the report said. However, Chevron argued that the start of operations should be defined as the point when all three processing units at the plant reached a steady state, which the agency disagreed with, according to Reuters.

The recommendation was reportedly made to Western Australia's environment minister Stephen Dawson. No date has been given for a final decision on the penalties, Reuters reported.

Gorgon LNG is considered to be the largest carbon emitter in Australia compared to other nine LNG plants, but it is expected to become the lowest emitter in the country after its CO2 injection system reaches full operations, burying between 3.4 million and 4 million tonnes of CO2 per year, Chevron told Reuters.

Chevron announced the start of operations at the CO2 injection system in August. The system is expected to slash emissions by around 40% upon full operations. The expected reduction amounts to more than 100 million tonnes during the system's lifetime.

Under the project authorization for Gorgon, Chevron is required to bury at least 80% of CO2 underground over an average of five years, Reuters reported.

Chevron subsidiary Chevron Australia Pty. Ltd. serves as project operator with a 47.3% stake in the Gorgon project.