Woodside Energy chief executive, Meg O'Neill, in an interview in March 2024.

The Albanese government in Australia has postponed its decision on approving Woodside Energy's North West Shelf (NWS) gas project extension in Western Australia, effectively prolonging an already lengthy process that has halted the Browse mega-project to date.

The federal government was supposed to make a decision before this Friday, but the deadline has been pushed back to March 31st, after the WA state elections on March 8th.

Federal Environment Minister Tanya Plibersek explained that her department needed more time to evaluate Woodside's application, which would allow for over four additional decades of gas operations and enable the $30 billion Browse liquefied natural gas project to move forward.

The state government approved the NWS project extension in December after a six-year approval process, but local media reported that the WA authorities did not submit the relevant documentation to their federal counterparts until earlier this month.

Woodside and its NWS partners aim to keep the giant liquefied natural gas hub at Karratha operational until 2070, with the exploitation of Browse's significant gas resources being a crucial aspect of the extended operations.

While the gas and LNG project can continue operating into the 2030s under its current terms and approvals, a Woodside spokesperson noted that the unexpectedly lengthy approval process is now impacting investment decisions necessary to support near-term gas supply in WA.

Industry association Australian Energy Producers (AEP) criticized the federal government's decision to delay the assessment of the NWS project extension, stating that it undermines Western Australia's energy security and highlights the failure of national environmental laws.

AEP CEO Samantha McCulloch emphasized that the NWS project has powered WA homes and industries for 40 years and will be crucial for the state's future energy security and economic prosperity. She added that the project is necessary to ensure a reliable and affordable gas supply to Western Australians, as the Australian Energy Market Operator predicts gas shortages in the state from 2030.

The WA gas industry is a significant contributor to the state's economy, providing 54% of WA's primary energy and 60% of its electricity. A recent report found that without new gas investment, the state would face gas shortages for electricity by the early 2030s and its mining and industrial sectors would be without gas by the middle of that decade.

The Business Council of Australia (BCA) echoed the AEP's concerns, describing the approval delay as detrimental to investment and business confidence in Australia's global competitiveness. BCA CEO Bran Black noted that the unexpected delay in project assessment, after already more than six years, is bad news for business investment and addressing a critical gas shortage in Western Australia. He added that this type of decision delay has real consequences for Australia's ability to compete for global capital and detracts from the nation's capacity to grow its economy and provide secure jobs.