WA Chamber of Minerals and Energy calls for tick on Woodside’s North West Shelf extension

WA’s resources sector is piling on the pressure for the Federal Government to make an urgent decision on the extension of Woodside Energy’s North West Shelf after a major, long-time buyer of Australian LNG threatened to walk away over approval delays.

The WA Chamber of Minerals and Energy said it wants a decision to push out the NWS approval for another 50 years made by the end of the month.

That echoes a similar call made by the Business Council of Australia on Wednesday.

Japanese energy giant JERA said earlier this week that it was looking to the US and Middle East as more reliable sources of LNG as Australia grappled with lengthy approvals processes to bring new projects online. Such a dramatic shift could cost thousands of local jobs.

Chamber chief executive Rebecca Tomkinson said comments warning Australia may no longer be the first choice for such a longstanding customers should “should ring alarm bells”.

“WA is heavily reliant on overseas investment to unlock the affordable gas we use domestically to power our homes and industry,” Ms Tomkinson said.

“AEMO forecasts WA will face a gas deficit from 2030. As JERA has highlighted, that is the same time long-term supply deals between WA and some of our international trading partners begin to expire.

“We cannot afford to act like we have a monopoly on LNG exports.

“We face increasingly fierce competition from jurisdictions like the US and Middle East, both of which are ramping up supply while Australia is putting up barriers to investment.”

Woodside wants environmental approval to run the LNG export plant at Karratha until 2070, but waited six years for the State Government to give the green light.

Commonwealth approvals were last month pushed back to March 31 amid debate over the project’s potential impact on Burrup Peninsula rock art.

Hitoshi Nishizawa, JERA’s senior vice-president of LNG, told a conference in Perth that new, cheaper supply from the US was due to come on stream from 2030 — just as long-term supply deals with Australia were due to expire, The Australian reported.

“In contrast to Australia, in the US there are expectations of abundant future new supply, cheaper prices, lower cost of production and labour, and faster project approvals for LNG projects,” he said.

“This may very well impact Australian LNG in terms of competition for additional long-term sales of LNG – to JERA and to others – in future round sales campaigns.”

Ms O’Neill has previously said blocking the project — which also supplies local gas for WA — would lead to more coal use on the power grid. State-owned coal power stations in WA are set to be shut by the end of the decade, with gas and renewables as replacements.

Ms Tomkinson said the years the NWS project extension had been left in limbo “was a flashing red light for investors and trading partners”.

“After already delaying its determination, it is imperative the Federal Government hand down a decision by March 31 to provide certainty for the businesses involved,” she said.

“Putting projects at risk in Australia simply means the demand will be met through new projects in other countries, destroying jobs and livelihoods here at home while providing no net benefit to global decarbonisation efforts.”

The BCA’s chief executive Bran Black wrote in The West Australian on Wednesday that Prime Minister Anthony Albanese had a chance to correct a “setback for Australia”.

“Ironically, it’s also a setback for the environment because it may force Australia to keep burning coal for longer,” Mr Black wrote.

Indeed, the Government’s Future Gas Strategy has made it abundantly clear that gas is a key transitional energy source as we move towards net zero.”

Federal Resources Minister Madeleine King is set to speak at the Energy Exchange Australian conference in Perth later on Thursday.