Sydney (Platts)--28Nov2012/145 am EST/645 GMT

Woodside Petroleum has submitted its proposal to the Western Australian state Environmental Protection Authority to build and operate the foundation Browse LNG project at the James Price Point precinct.

The proposal is now open for a seven-day public comment period ending December 4.

Woodside's submission follows the November 19 approval by state Environment Minister Bill Marmion of the Department of State Development's strategic proposal for an LNG precinct at James Price Point. That approval allows for multiple LNG producers to be co-located at the site, where capacity could be as much as 50 million mt/year.

"The strategic assessment of the Browse LNG precinct allowed the consideration of the cumulative environmental impacts of future proposals, known as derived proposals," EPA Chairman Paul Vogel said in a statement Wednesday. "The conditions approved by the Minister for Environment will guide the overall development plan, as well as apply to specific future LNG projects within the precinct."

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Vogel and Deputy Chairman Professor Robert Harvey will now determine whether the proposal submitted by Woodside fits within the defined precinct footprint and can be declared a derived proposal.

"If there is significant new or additional information raised by the proposal, then the EPA may consider whether further assessment is warranted," Vogel added.

The Woodside-led foundation project would produce 12 million mt/year of LNG from three trains. The company is currently evaluating tender bids and undertaking an assurance process to determine costs and economics for the project, with a view to making a final investment decision in the first half of 2013.

Woodside and its joint venture partners were earlier this year granted a one-year extension of their government-imposed deadline of July 2012 to formally approve the LNG project. Under the terms of lease renewal conditions outlined by the Australian federal and Western Australian state governments in 2009, the partners had been required to spend A$1.25 billion ($1.31 billion) on front-end engineering and design, and to take FID on the proposed LNG project by the middle of 2012.

The James Price Point site is in an environmentally and culturally sensitive area in Western Australia's Kimberley region and has been mired in controversy over recent years as some local landowners have refused to support an A$1 billion social and economic benefits package signed in June 2011 by Woodside and the Goolarabooloo Jabirr Jabirr native title claimant group.

The Western Australian government has designated the greenfields site on James Price Point as a processing precinct for all the gas to be developed in the offshore Browse Basin. Under its retention lease conditions, Woodside's joint venture was required to build its onshore liquefaction facilities at James Price Point, unless it could demonstrate an alternative development concept was likely to be commercially viable at an earlier time.

Woodside's partners in the Browse project are BP, BHP Billiton, Japan Australia LNG (MIMI) and Shell, which took additional equity from Chevron in August. Since then, speculation has mounted that the joint venture may opt to use the floating LNG technology being pioneered by Shell at its nearby Prelude gas field to commercialize the 15.5 Tcf of gas and 417 million barrels of condensate contained in its Browse fields, rather than pursue an expensive onshore development.

Some local analysts are tipping Woodside's Browse LNG project proposed for James Price Point could cost as much as $45 billion.

--Christine Forster, christine_forster@platts.com --Edited by Martin O'Rourke, martin_orourke@platts.com

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