Federal Government Grants Extension to North West Shelf LNG Terminal Amid Regulatory Challenges

Australia’s federal government has granted a long-term extension for the North West Shelf (NWS) LNG terminal in Western Australia, which has a capacity of 14,3 million tons per year. This decision alleviates some regulatory challenges faced by the project.

The approval mandates that the NWS joint venture monitor and manage air emissions to safeguard the Dampier Archipelago National Heritage Place, as stated by Woodside Energy on September 12. Woodside Energy holds a 50 % stake in the NWS terminal.

The federal government initially provisionally approved the extension on May 28, contingent upon environmental conditions aimed at protecting 60 000-year-old indigenous rock art in the nearby Murujuga Cultural Landscape. However, discussions between the government and Woodside Energy regarding specific conditions extended for several months, delaying the final approval.

The NWS extension project still encounters legal challenges. In mid-June, Friends of Australian Rock Art (Fara) appealed the WA government’s 2024 decision to approve the project, claiming that air pollution from the terminal is damaging ancient indigenous rock art.

Woodside has reiterated its commitment to protecting the Murujuga Cultural Landscape, as mentioned on September 12.

Additionally, the project faces non-legal challenges. Global energy producer Shell, which owns a one-sixth stake in the NWS project, is reevaluating its involvement. A company spokesperson informed Argus on September 5 that Shell regularly reviews its project portfolio to ensure disciplined capital allocation.

NWS’s LNG production decreased by 22 % year-on-year in January-March due to a decline in feedstock, which led to the suspension of a 2,5 million tons per year processing train. The joint venture plans to develop the Browse gas field to compensate for the NWS production shortfall.