Australia Approves Woodside Energy’s North West Shelf Gas Plant Extension

Australia conditionally approved on Wednesday a request by Woodside Energy to extend until 2070 the life of its North West Shelf gas plant, following a six-year review dogged by delays, appeals, and backlash from green groups.

The facility on the Burrup peninsula in Western Australia is the country’s oldest and largest liquefied natural gas plant and a key supplier to Asian markets. However, concerns about its emissions potentially endangering ancient rock art have delayed a final decision.

Strict Conditions and Cultural Heritage Considerations

In a statement, Environment Minister Murray Watt emphasized that the approval of the project extension is subject to strict conditions, particularly regarding air emissions levels. The impact of emissions on the Murujuga rock art on the Burrup peninsula was a significant factor in the assessment process.

“I have ensured that adequate protection for the rock art is central to my proposed decision,” Watt stated. Woodside has been given 10 days to respond to the conditions related to air quality and cultural heritage management before the final decision is made.

The existing approval for the project was set to expire in 2030. Australia has nominated the Murujuga landscape for World Heritage listing in 2023, but concerns about industrial pollution, including emissions from the gas plant, have been raised by a U.N. advisory body.

Woodside’s Response and Share Price Movement

Woodside welcomed the government’s decision and expressed commitment to protecting the Murujuga cultural landscape and supporting its World Heritage nomination. Following the news, Woodside shares saw a 4% increase in the afternoon trading session.

Climate Concerns and Project Implications

The approval of Woodside’s extension application comes after a lengthy assessment process involving energy security and environmental impact considerations. The extension paves the way for Woodside to develop new gas fields to feed the LNG plant, with an expected carbon emissions output of up to 4.3 billion metric tons over its lifetime.

Australia’s Climate Council criticized the approval as a “failure of leadership” and a detrimental mark on the government’s climate record. The extension also enables Woodside to progress its Browse offshore project to supply gas to the Karratha plant, as the original offshore gas fields at the North West Shelf are declining.

Woodside’s partners in the North West Shelf venture include units of BP, Chevron, Shell, Mitsui & Co, Mitsubishi Corp, and CNOOC. The state government of Western Australia approved the project in December after addressing numerous appeals from activists, while the federal government delayed its decision twice prior to general elections in May.

(Source: Reuters – Reporting by Christine Chen and Renju Jose in Sydney; Editing by Sonali Paul and Clarence Fernandez)