Bloomberg News

Australia to Rule on Woodside Request to Delay Browse Soon

March 23, 2012

Woodside Petroleum Ltd. (WPL), the second-largest oil producer in Australia, will know within weeks whether the government will allow it to delay deciding on the Browse liquefied natural-gas project until 2013.

The ruling, made under Australia’s “use-it-or-lose-it” policy, will be made in “a couple of weeks,” Energy Minister Martin Ferguson told reporters today following a speech in Sydney, according to an e-mailed transcript.

Perth-based Woodside is seeking the delay as costs to build projects in Australia climb, the company said in December. Its current lease agreements mean it has to decide on the project by the middle of 2012. Australia wants to ensure that the reserves aren’t “warehoused indefinitely” by energy companies such as Woodside, Ferguson said in his speech today.

Australia has eight LNG ventures under development to tap rising Asian demand for the less-polluting alternative to coal. Ferguson, who estimated the projects would cost A$175 billion ($182 billion), said he doesn’t expect any new LNG projects to be approved in Australia in the next 12 months to 18 months.

“Demand for energy from countries such as China and India, as well as other long-term trading partners, presents great opportunity,” Ferguson said in the speech. “But competition from other suppliers is also increasing.”

To contact the reporter on this story: James Paton in Sydney at jpaton4@bloomberg.net

To contact the editor responsible for this story: Amit Prakash at aprakash1@bloomberg.net


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