Federal Libs open to FLNG
An Abbott coalition Government would be open to developing huge gas fields via floating offshore processing, including for Woodside's $40 billion Browse venture, to ensure the gas was developed as quickly as possible.
With the Liberal-Nationals Federal coalition odds-on to take power in September, shadow resources minister Ian MacFarlane has made the Opposition's first definitive statement on the issue.
The policy sets the Federal Liberal party at odds with WA Premier Colin Barnett, who opposes floating LNG processing for Browse and other major gas fields, arguing the technology will mean local jobs will be lost to overseas shipyards.
Mr MacFarlane told _WestBusiness _his preference was for the gas to come ashore but that there was no point being bloody minded about the issue if it meant companies would shift their focus to other countries and leave the gas in the ground.
"From a coalition point of view, we want to see the resource developed sooner rather than later," Mr MacFarlane said.
"The sooner there are jobs for Australians operating it (Browse), the sooner there is PRRT (petroleum resource rent tax) income for the Federal Government.
"Whilst I respect Colin's position and hear what the unions are saying, if it is a choice between jobs in operating and ongoing maintenance of the facilities from bases in Australia, or no jobs for an onshore option at James Price Point, I know which option I am going to choose."
Mr MacFarlane has an unlikely ally in the debate in Federal Labor Resources Minister Gary Gray, who says FLNG is an opportunity for WA to be at the cutting edge of technology and to develop skills beyond those used in basic construction.
The Federal Government notionally supports land-based processing at James Price Point, but has yet to give environmental approval.
Some in the industry believe it is preparing to ditch its support for the controversial site opposed by green groups which, if true, would mean the coalition's position would assume more than theoretical status should it win in September.
Woodside and its joint venture partners must report by June whether the project is economically viable under their retention lease obligations, but many analysts believe it will not be profitable given spiralling costs in WA.
This has opened the door for Woodside's partner Royal Dutch Shell to argue for FLNG.
Mr MacFarlane said there was a danger that if Browse continued to be delayed, companies could move to other parts of the globe. "Costs aren't getting any lower and no one can predict where the industry will be in five years," he said.
"I still haven't forgotten projects that were put on ice when I was the minister while companies went and invested elsewhere in the world, particularly Shell, who went to Sakhalin rather than develop projects in Australia."
He said a retention lease extension should only be given with a commitment for development.
