State Government grants in-principle approval for the development of Australia's largest gas resource

8/9/03
The State Government today granted in-principle approval for the use of Barrow Island for the $11billion development of the Gorgon gas field, Australia's largest gas reserve.
The approval to allow development on 300-hectares of land representing only 1.3 per cent of the island was made conditional on the Gorgon Joint Venture meeting strict State and Commonwealth environmental safeguards.
This will ensure that Barrow Island's unique environment continues to be preserved.
Premier Geoff Gallop said the $11billion two-stage Gorgon development had the potential to be Australia's biggest industrial project and would double the size of Western Australia's gas industry.
He said the project had significant local, national and global benefits.
"The Gorgon project has the potential to underpin WA's and Australia's economic prosperity for decades to come, delivering thousands of new jobs and billions of dollars in revenue for the country," Dr Gallop said.
"It will also generate new export deals like last year's $25billion contract to sell LNG to China.
"The world is increasingly looking towards natural gas as a clean and reliable energy source and the State Government is positioning WA as a major global supplier into the future."
Key economic benefits would include:

• a construction workforce of 3,000 and a permanent workforce of 400;
• another 6,000 indirect jobs across the nation, including at least 1,700 in WA;
• annual exports of $2.5billion;
• $17.8billion (npv) in revenue to the Commonwealth Government;
• $300million (npv) in State Government revenue; and
• a $2billion a year boost to the State economy.

The Premier said the Gorgon development would ensure WA continued to lead the nation in economic and employment growth and would also secure the State's energy future.
He said the Government had required the company to set aside 2,000 petajoules of gas for domestic consumption, which was enough gas to meet WA's current electricity production and household needs for the next 25 years.
In-principle approval had also been made conditional upon the company committing to deliver the domestic gas reserve to the mainland.
State Development Minister Clive Brown said the Gorgon development would significantly build upon the Government's gas-processing achievements on the Burrup Peninsula, which had been creating jobs and opportunities throughout WA.
"The Government has been working hard over the past two and a half years to develop a world-class gas processing industry in WA and today's decision will be viewed by history as a defining moment," Mr Brown said.
"It also sends a clear signal to the world that WA is open for business as the region's leading energy supplier."
The Premier said the Government was committed to maintaining Barrow Island's high conservation values as an A-Class Reserve and had secured important environmental commitments from the company.
"In addition to committing to better than world's best practice quarantine measures on Barrow Island, the Gorgon development will utilise world-leading geological sequestration technology to re-inject beneath the island carbon dioxide from the raw gas," Dr Gallop said.
"This will result in the Gorgon gas processing operation being the most greenhouse efficient LNG operation in the world."
Mr Brown said Barrow Island had been an operating oil field for 40 years and parliamentary approval was required for any further industrial development.
He said legislation to allow the Gorgon Joint venture access to the island along with a State Agreement outlining the terms and conditions of that access would be introduced into Parliament this week.
"The legislation will allow the joint venture to submit a formal proposal which must then undergo statutory State and Commonwealth environmental assessments," Mr Brown said.
"Parliamentary approval will also allow the joint venture to market their gas - both internationally and locally - and negotiate contracts with certainty.
"It is important the legislation be passed by the end of the year to ensure valuable market opportunities are not lost."
Media contacts:
Premier's Office - 9222 9475
Minister for State Development's Office - 9222 9699