The natural resources sector relies heavily on diesel-powered vehicles, mobile equipment and remote power systems across mining, oil and gas, and coal operations. In this part of the economy, low carbon liquid fuels (LCLFs) are one option for reducing emissions while electrification, battery-electric equipment, renewable power and other decarbonisation pathways continue to develop.
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874 PJof energy use per year
Australia’s natural resources sector used 874 PJ of net energy a year, making it one of the country’s largest industrial energy users.
~22%of Australia’s scope 1 emissions
The natural resources sector produces about 22% of Australia’s direct scope 1 emissions a year.
Scope 1 emissions are greenhouse gases released directly from activities at a facility, including fuels used in transport, diesel generators, production equipment and fugitive emissions such as methane leaks.
~55%of resources scope 1 emissions from fuel combustion
The Resources Sector Plan splits natural resources sector scope 1 emissions into about 55% fuel combustion and 45% fugitive emissions.
Oil and gas, coal and other mining
Annually, natural resources sector scope 1 emissions were split across oil and gas at 48%, coal at 36%, and other mining at 16%.
Scope note
Low carbon liquid fuels can reduce emissions from diesel and other fuel combustion where the finished fuel has lower life-cycle emissions. They do not directly address fugitive methane from coal operations or fugitive carbon dioxide and methane from oil and gas operations.
How the natural resources sector is reducing emissions
Resources-sector decarbonisation involves a portfolio of measures. The right mix differs by commodity, site, equipment fleet, grid access, haul profile and infrastructure timing.
Electrified haulage and on-site equipment
Battery-electric haul trucks, trolley assist, charging infrastructure and electric drills are being developed or deployed where they fit site layouts and duty cycles.
Renewable power and microgrids
Remote and off-grid sites can combine grid connection, on-site renewables, storage and power-system upgrades to reduce stationary energy emissions
Energy efficiency and operational improvement
Mine planning, maintenance, ventilation, dispatch systems and energy management can reduce fuel use and improve productivity.
Drop-in low carbon liquid fuels
Renewable diesel, biodiesel blends and synthetic diesel-type fuels can support equipment and remote operations where electrification is not yet practical.
Low carbon liquid fuels for resources
For existing resources fleets, the most relevant low carbon liquid fuel options are renewable diesel, biodiesel and, over a longer timeframe, synthetic diesel-type fuels. Australia’s fuel quality framework distinguishes conventional diesel, paraffinic diesel and biodiesel, and the Resources Sector Plan recognises low carbon fuels as a credible pathway where electrification or renewable infrastructure is not feasible
Renewable diesel
A diesel-equivalent hydrocarbon fuel produced from oils, fats and residues through hydrotreating (HVO/HEFA) or through synthetic pathways (PtL). Chemically and functionally different from biodiesel.
How it can fit in resources
drop-in low carbon liquid fuel for existing diesel natural resources sector fleets
Considerations
It can align with paraffinic diesel specifications and may be suitable for some existing engines, subject to original equipment manufacturer (OEM) approval and operating conditions.
Biodiesel and fatty acid methyl ester blends
A liquid fuel made by reacting fats or oils, such as vegetable oils, used cooking oil or tallow, with an alcohol.
How it can fit in resources
May offer a lower-carbon substitute or blend component for diesel applications in the natural resources sector.
Considerations
Usually requires closer attention to blend limits, storage, maintenance practice and OEM requirements.
Synthetic diesel-type fuels (including Fischer-Tropsch fuels biomass-to-liquid and power-to-liquid (e-fuels))
Diesel-type fuels made from biomass-derived synthesis gas, or from renewable hydrogen (H₂) combined with a carbon source.
How it can fit in resources
Chemically similar to renewable diesel, most relevant where very low lifecycle emissions are needed and direct electrification remains difficult.
Considerations
Volumes are limited and production pathways are still developing. Life-cycle emissions depend on feedstocks, energy inputs and certification.
Implementation note
A fuel that is technically drop-in still needs to fit the operator’s engineering assurance, OEM approvals, maintenance practice, storage arrangements and site safety controls before broad deployment.
On-site fuel handling
In the natural resources sector, fuel handling must support high-utilisation equipment, remote locations and harsh operating conditions. Bulk and temporary tanks should be secure, bunded, clearly labelled and positioned to protect waterways, haul roads and operating areas. Mobile refuelling is critical for keeping haul trucks, drills, loaders, generators and pumps productive, with trained operators, spill response equipment and accurate fuel issue records.
On-site fuel quality testing is especially important where fuel may travel long distances, sit in storage or be exposed to dust, heat, cold or water contamination. OEM and maintenance teams should approve any fuel changes before use, including compatibility with engines, filters, after-treatment systems and warranty requirements. ULSD and renewable diesel, such as HVO, should be managed with clear specifications, separate labelling where required, contamination controls and documented supplier approvals.
How fuel moves through the resource sector
Supply & refining
Delivery to site
Secure site storage
Quality checks on site
Controlled fuel
Use in plant & equipment
Resources fuels today
Across much of the natural resources sector, conventional diesel remains central to extraction and processing operations, especially for mobile equipment and remote power. The Resources Sector Plan identifies fuel combustion emissions from vehicles, equipment and power systems as a major decarbonisation focus.
Conventional diesel remains central
Diesel is used in mobile equipment, service fleets, generators and other high-utilisation site assets.
Remote operations matter
Liquid fuels remain especially relevant where charging infrastructure, grid connection or renewable power systems are limited or still being developed.
Fuel switching is one pathway
Fuel switching can sit alongside electrification, renewable power, energy efficiency and other technology changes.
Australia
Clean Energy Finance Corporation (CEFC) and Minerals Research Institute of Western Australia (MRIWA) – 2022
Clean Energy Finance Corporation (CEFC) and Minerals Research Institute of Western Australia (MRIWA) – 2022
Clean Energy Finance Corporation (CEFC) and Minerals Research Institute of Western Australia (MRIWA) – 2022
Australian Academy of Technological Sciences and Engineering (ATSE) – 2025
International Energy Agency (IEA) – 2022
Australian Contractors Association – 2024
International and technical
International Energy Agency (IEA)-2025
IEA Bioenergy Task 39 · 2024
Policy, regulation and technical guidance
The sections below cover the legislation, standards, policy, certification criteria and organisations shaping low carbon liquid fuel use across the mining and resources sector, grouped by the role they play.
Peak industry body for the Australian bioenergy sector, representing producers, technology providers and end-users of low carbon liquid fuels, biogas and bio-based products. Publishes industry strategy, including the Securing our Fuel Future roadmap (Ref 105).
National peak industry body representing Australia’s minerals sector and a key voice on competitiveness, sustainability and sector policy.
National industry body for Australia’s mining equipment, technology and services sector, with a strong focus on innovation and sustainable mining solutions.
National WHS policy body whose diesel exhaust guidance is relevant across mining and other diesel-intensive workplaces.
Global multi-stakeholder mining body that develops operator-driven guidance and resources to improve safety, sustainability and productivity in mining.
A standards organization that develops and publishes voluntary consensus technical international standards for a wide range of materials, products, systems and services.
Technical standards drafted and maintained by CEN (European Committee for Standardization), CENELEC (European Committee for Electrotechnical Standardization) and ETSI (European Telecommunications Standards Institute)
Australian Government portfolio responsible for natural resources sector policy, hosting the Resources Sector Plan (Ref 158) that sets the national direction for natural resources sector emissions reduction and the transition to low carbon energy use, including low carbon liquid fuels in natural resources applications.
Provides funding and support for low carbon liquid fuel studies, demonstrations and infrastructure work, including natural resources sector projects.
Australia’s Guarantee of Origin scheme, which is administered by the Clean Energy Regulator, provides a transparent, publicly accessible record of the emissions associated with the production of key commodities, including low carbon liquid fuels. The scheme is being expanded to cover low carbon liquid fuels.
Independent global certification scheme covering sustainable biomass, bio-based materials, renewable fuels and circular economy products. ISCC is one of the certification schemes recognised under the International Civil Aviation Organization’s (ICAO) Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), and is widely used across European Union renewable fuel pathways.
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