Federal Approval Extends North West Shelf LNG Operations to 2070

Disclaimer: The following article is based on an original report by the Australian Financial Review. [https://www.afr.com/companies/energy/watt-makes-the-only-choice-on-woodside-20250528-p5m2x4]

Australia’s newly appointed Environment Minister, Murray Watt, has granted conditional approval for Woodside Energy’s North West Shelf gas project to continue operating until 2070. This decision, long awaited after multiple delays under former minister Tanya Plibersek, reflects a broader recognition of the economic and energy security role Natural Gas plays in Australia’s future—despite growing pressure from environmental groups.

The decision allows the Karratha Gas Plant in WA to continue its operations, subject to strict environmental conditions, particularly around air emissions and cultural heritage protection. Woodside now has 10 business days to respond before the decision is finalised.

This extension was strategically timed, arriving after the resolution of federal election pressures. It aligns with the preferences of the Western Australian Government and local unions, aiming to preserve economic stability, secure thousands of jobs, and ensure ongoing LNG exports, which are critical to the national economy.

However, the move has sparked criticism. UNESCO recently deferred Australia’s application for World Heritage listing of Burrup Peninsula’s rock art, citing industrial activity in the region, including Woodside’s presence. The Federal Government maintains that recent emissions are not responsible for the deterioration and has committed to continued cultural heritage safeguards.

Woodside welcomed the decision, noting it followed six years of regulatory review and comes with commitments to reduce emissions. CEO Meg O’Neill emphasised that LNG remains essential to global decarbonisation, particularly in Asia, and cautioned against overestimating the pace of the renewables rollout.

As the global energy transition evolves, Woodside is also expanding abroad, recently greenlighting a major LNG project in the US. Domestically, this approval secures long-term investment confidence in the LNG sector but may face renewed opposition in urban constituencies and environmental circles.

Implications for ACERA Members

• Regulatory Clarity: The approval provides a clearer regulatory environment for long-term LNG investment in Australia.

• Investor Confidence: Reinforces confidence for energy infrastructure investment, both in WA and nationally.

• Environmental Scrutiny: Highlights the increasing pressure to balance development with emissions reductions and cultural heritage—a key consideration for ESG reporting.

• Export Competitiveness: Ensures the continuity of LNG supply to Asia, supporting Australia’s position as a reliable exporter.

ACERA encourages members to closely monitor evolving environmental conditions and stakeholder expectations, particularly regarding Indigenous heritage and net-zero transitions. This decision is a timely reminder of the importance of aligning project development with social licence and ESG standards.