Talks about 40-year continuation of Australia’s mega gas project draw out

Australia’s energy giant, Woodside Energy, has made arrangements with the federal government to continue discussions about the proposed requirements for environmental approval of a lifespan extension for its mega gas project off the Australian coast, enabling it to run until 2070.

Following the Western Australian government’s decision to grant environmental approval for the North West Shelf (NWS) project extension after six years of assessment and appeals, Woodside and the North West Shelf joint venture disclosed the federal government’s proposed decision to grant environmental approval for the NWS project extension.

This came with a set of proposed federal conditions related to matters such as cultural heritage management and air quality. In an update about the current state of affairs, the Australian giant confirmed the continuation of constructive consultation with the federal government. An extension of the consultation period has been arranged to sort out all the details of the government’s proposed conditions.

The operator underlined: “Woodside recognises the importance of the matters being addressed by the proposed conditions of the environmental approval including cultural heritage management and air quality.

“The North West Shelf Project has supplied more than 6000 petajoules of domestic gas, powering homes and industry in Western Australia. If used just for household electricity, this is enough to power homes in a city the size of Perth for approximately 175 years.”

As part of an argument for a positive outcome for the North West Shelf project extension’s environmental approval process, the Australian giant has listed some of the benefits the project has enabled so far, including paying more than A$40 billion (more than $25.93 billion) in royalties and excise over the past four decades.

In addition, the NWS gas project has provided employment and contracting opportunities to the Pilbara and broader Western Australian community, and invested well over A$300 million (nearly $194.4 million) in social and community infrastructure within the city of Karratha.

The approval of this extension is key to advancing Woodside’s $30 billion Browse gas project and enabling the long-term processing of the NWS joint venture field resources and third-party gas resources through the Karratha gas plant (KGP), located 1,260 kilometers north of Perth in Western Australia.

Woodside also took a final investment decision (FID) on the low-pressure operation project at Goodwyn Alpha, aimed at increasing NWS production from the Goodwyn area reservoirs.

Those opposed to the 40-year extension, such as the Australia Institute, claim that the move would allow huge amounts of gas to be given away royalty-free, outlining an estimate of up to $215 billion worth of gas that could be in play.

The Australia Institute elaborated: “We conservatively assume that that 70% of Karratha Gas Plant feedstock gas is royalty-free by the mid-2030s, and a price of $8/GJ for gas, which is now common in WA wholesale trades.

“On these assumptions, the NWS shelf extension will be receiving around $5.1 billion a year in royalty-free gas, or $14 million each day, or $215 billion over the project’s 46-year life.”