Woodside cheers ‘critical step’ for 50-year extension of mega gas project offshore Australia

A years-long sage seems to be coming to an end, as Woodside Energy has secured environmental approval from the Western Australian government for the extension of its giant gas project off the coast of Australia. This decision has restarted the federal environmental approvals process.

The Western Australian government’s decision to grant environmental approval for the North West Shelf (NWS) project extension comes after six years of assessment and appeals. As a result, Woodside sees this as “a critical step” in the approvals process to underpin the ongoing operation of the North West Shelf project, enabling it to keep delivering “a reliable supply of energy locally and globally.”

Since the state’s decision recommences the federal environmental approvals process, which was paused while appeals were being considered, Woodside’s Executive Vice President and Chief Operating Officer, Liz Westcott, said state approval of the North West Shelf project extension is an important step to enable the long-term processing of the NWS joint venture (JV) field resources and third-party gas resources through the Karratha gas plant (KGP).

Located 1,260 kilometers north of Perth in Western Australia, the Karratha gas plant (KGP) is an integrated gas production system, producing LNG, domestic gas, condensate, and LPG. Covering about 200 hectares, the KGP has an export capacity of 16.9 mtpa, with five LNG processing trains, two domestic gas trains, six condensate stabilization units, and three LPG fractionation units.

Westcott highlighted: “This year we are celebrating 40 years of domestic gas production from the Karratha gas plant and 35 years of LNG exports – a contribution to reliable energy supply which can continue for years to come. We look forward to the finalisation of the Federal approval process to provide certainty around the ongoing operation of the North West Shelf project.

“By using existing infrastructure, the project can continue to support local and global energy security and regional development opportunities in the Pilbara in northern Western Australia. We are committed to ensuring we continue to meet all environmental requirements, including the conditions of this approval, and engage in meaningful consultation with Traditional Owners regarding our activities.”

Furthermore, the North West Shelf JV committed to a range of environmental management measures as part of the approval, including a significant curtailment in air emissions such as oxides of nitrogen and volatile organic compounds as well as greenhouse gas (GHG) emissions management measures to reduce emissions over time. The approval of the extension is key to advancing Woodside’s $30 billion Browse gas project.

Following the start of operations in 1984, the North West Shelf project has supplied more than 6,000 petajoules of domestic gas, powering homes and industry in Western Australia. If this amount of gas were solely for household use, it is estimated to provide enough power for every home in a city the size of Perth for approximately 175 years. If the federal approval comes in, this will extend the Karratha gas plant’s life to 2070.

During the 3Q 2024, the NWS project achieved quarterly LNG reliability of 99.2%. Woodside completed planned maintenance offshore at North Rankin Complex and an onshore LNG train at the Karratha gas plant, with production recommencing as planned.

The company took a final investment decision (FID) on the low-low pressure operation project at Goodwyn Alpha, aimed at increasing NWS production from the Goodwyn area reservoirs. This project is targeted for startup in Q2 2027. The firm is planning to bring one LNG train offline for retirement in the fourth quarter of 2024.

Moreover, the North West Shelf project has paid over $40 billion in royalties and excise over the last four decades, providing employment and contracting opportunities to the Pilbara community and investing well over $300 million in social and community infrastructure.

However, some are still opposed to the 50-year extension, including the Australia Institute, which recently outlined that a decision by the Western Australian government to approve Woodside’s 50-year North West Shelf extension would add up to 4.3 billion tons of emissions to the atmosphere and lock in exposure to high global gas prices indefinitely, increasing energy costs for WA households and businesses.

Aside from this, it also said the approval would expose WA’s domestic gas market to global gas prices, repeating the policies that created havoc in east coast markets, permanently increasing gas and electricity bills for households and businesses.

Mark Ogge, Principal Adviser at The Australia Institute, underlined: “Woodside is asking for a 50-year extension of one of the largest fossil fuel projects in the world. This decision would add billions of tonnes of emissions into our atmosphere, making heatwaves, droughts and floods more frequent and extreme in WA and the rest of the world.

“If the WA Government caves into lobbying from the gas industry it will expose WA consumers to global prices. This would be a repeat of the mistake of east coast governments a decade ago that led to chaos in east coast markets. Western Australian households and businesses will pay with higher energy bills for decades if the government kowtows to Woodside.”

While Anna Chapman, Conservation Council WA, sees the approval of the 50-year extension for the NWS project as “a monumentally destructive decision by Minister Reece Whitby and the WA government that seeks to lock in huge volumes of fossil fuel production until 2070,” Roger Cook, WA Premier, is adamant that gas is going to play “an important role in helping other countries get out of coal.”

According to the Western Australian government, the clean energy investment pipeline in Western Australia is around $200 billion, and projections show the clean energy sector is expected to generate around 351,000 jobs from 2025 to 2050.