LNG producers take aim at North West Shelf approval delays

The federal government is under pressure to make a decision about Woodside’s North West Shelf extension as the $70bn LNG export industry seeks to restore investor faith in the industry.

Environment Minister Tanya Plibersek. Picture: Martin Ollman

The oil and gas industry has heaped pressure on the Albanese government to make a call on an extension of the North West Shelf project without delay to help restore the faith of Japan’s biggest LNG buyer and other major ­customers.

Japan’s JERA rocked the industry by telling a major conference in Perth that it would look to rival nations for supply and warning of thousands of job losses in Australia in the face of increased competition in LNG from the US and Middle East.

Federal Resources Minister Madeleine King is due to speak at the West Australian government-sponsored Energy Exchange Australian conference on Thursday amid growing industry frustration over cabinet colleague Tanya Plibersek delaying a call on the NWS in her capacity as Environment Minister.

The WA Chamber of Minerals and Energy, whose members include major LNG producers Woodside, Chevron and INPEX, said a decision to approve the 50-year extension of the NWS had to be made this month and before the nation headed to the polls.

“As a long-term supplier of LNG to Japan, hearing companies like JERA warning Australia may no longer be their first choice should send alarm bells ringing,” CME WA chief executive Rebecca Tomkinson said.

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

“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.”

Resources Minister Madeleine King. Picture: Pema Tamang Pakhrin

JERA warned that Australia was sending mixed messages on support for the sector while the US and the Middle East charged ahead as reliable suppliers with far shorter project approval times.

Ms Tomkinson said the government could not behave as if Australian had a monopoly on LNG exports.

“The six-plus years the NWS project extension has spent waiting for environmental approval is a flashing red light for investors and trading partners who are growing increasingly concerned about Australia’s future standing as a stable, affordable and reliable supplier of gas,” she said.

“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.”

Woodside chief executive Meg O’Neill has said she is “beyond frustrated” with delays in approving an extension for the company’s NWS operations and has warned the dithering threatens drilling for much-needed domestic gas.

Opposition resources spokeswoman Susan McDonald said JERA’s comments confirmed that the government was squandering Australia’s hard-earned reputation as a reliable trading partner.

Ms King defended the government’s record on energy policy, saying it was taking “measured steps” to shore up gas supply.

“We have halved Environmental Protection and Biodiversity Conservation Act decision-making timeframes because we hired more public servants to assess the approvals backlog,” a spokesman for Ms King said.

Woodside last year secured WA approval to extend the NWS operations, a decision that took more than six years, but still requires a federal tick.

WA Premier Roger Cook last month took aim at “nerdy little bureaucrats in Canberra” after Ms Plibersek again delayed her decision on the extension.

Woodside shares closed down 2.1 per cent at $22.70.

The stock has tumbled 7.7 per cent since the start of the year.

By comparison, Santos, which rose 0.16 per cent to $6.17 on Wednesday, is off 7.6 per cent since the start of January.

Originally published as LNG producers take aim at North West Shelf approval delays