WA's top environment defender says he could be powerless to stop a bid to process gas offshore from Woodside's $40 billion Browse project, potentially undermining Premier Colin Barnett's campaign against the plan.
Environmental Protection Authority chairman Paul Vogel made the comments as speculation swirls that Woodside and its joint venture partners are preparing to jettison a land-based plant at James Price Point as too costly.
Woodside's joint venture partner in the development, Royal Dutch Shell, has publicly stated it wants to use its world-leading floating LNG technology, being tested on the nearby $US12.6 billion Prelude venture, to cut costs.
Mr Barnett, who has invested significant political capital in the James Price site, earlier this month vowed he had the power to stop any floating push.
However, he was vague on how he could achieve this, other than a veiled threat to strip the partners of their retention leases when they expire in the middle of this year - a move which would introduce significant risk for major investors in Australia's oil and gas industry.
Now Dr Vogel has cast further doubts on the ability of WA to intervene in the commercial affairs of the global petroleum giants.
He suggested it was unlikely the EPA would have a role in any environmental approval of an FLNG project, as it would be in Commonwealth waters. "We had no role in that assessment (Prelude)," Dr Vogel said. "It was purely a Commonwealth assessment.
"It is highly unlikely that the EPA would be involved in the environmental impact assessment of an FLNG facility, because those facilities would generally tend to be in Commonwealth waters."
Dr Vogel said there was a small chance any FLNG proposal would have to pass across the EPA's desk if it was within three nautical miles (5.4km) off Scott Reef, which pops up in the middle of the ocean in the region, and WA technically "owns". The EPA chief said it had already warned about development on Scott Reef but it was not for him to express a view on the commercial aspects of FLNG.
Mr Barnett has warned of the environmental risks of floating versus land-based processing, but these have been dismissed by Shell.
Dr Vogel's comments come against a background of a number of decisions recently by Federal Environment Minister Tony Burke stymieing resource developments in WA, including Toro Energy's planned uranium mine.
Although Federal Resources Minister Martin Ferguson supports the land-backed James Price site, some in industry have speculated that Mr Burke - who is yet to rule on the Browse project - could reject a land-backed solution to appease environmentalists fiercely opposed to the plan.
Opposition Leader Mark McGowan has said he would allow the Browse partners to pipe the gas to existing facilities in Karratha.