Andrew Probyn, Peter Kerr and Gareth Parker, The West AustralianApril 12, 2013, 5:33 am
The controversial James Price Point gas hub will today be pronounced dead, with project operator Woodside Petroleum expected to declare the $40 billion Kimberley development uneconomic.
The West Australian believes that Woodside will make the announcement shortly before the Australian Securities Exchange opens this morning, confirming widespread speculation that has been sweeping through the industry.
It will leave the future of what was going to be one of Australia’s biggest-ever resources projects in limbo and fuel suggestions that Woodside’s Browse project partner Royal Dutch Shell will get its way with an alternative offshore processing option.
The Anglo-Dutch petroleum giant has in recent weeks been agitating for the gas field to be developed with its cutting-edge floating liquefied natural gas vessels in a bid to offset WA’s spiralling construction costs. Premier Colin Barnett has mounted an isolated campaign against the FLNG tankers, arguing that only a land-based solution at James Price Point would deliver the right mix of jobs and economic development to the State.
Others, including Federal Resources Minister Gary Gray, argue that FLNG could be an opportunity for Australia to form a high-tech jobs and skills base. Mr Barnett told parliamentary question time yesterday that the joint venture partners had until the end of June to make a final investment decision.
“I have continuous discussion with Woodside and it’s not for me to comment publicly, particularly to market sensitive information on what decisions might be,” he said.
Asked by Opposition Leader Mark McGowan if he had received advice in the past week from the joint venture partners that the project would not proceed, Mr Barnett said: “I have not received advice to that effect from the joint venture partners at all. At all.”
Senior sources told The West Australian that the WA Government and Canberra had been informed by Woodside of its impending announcement.
James Price Point has been fiercely opposed by conservationists and is yet to be given environmental approval by the Federal Government. One of the sources said Woodside’s decision was not the end of the environmental approvals process but “if the Browse Basin is to be developed, then the joint venture partners will have to use FLNG”.
It is not clear how the development would affect the up to $1.5 billion indigenous social benefits and jobs package that was contingent on the land-based site proceeding.
Woodside did not comment.