Wednesday, December 14, 2011

Third parties may get a say to stop warehousing of offshore oil discoveries | The Australian

Third parties may get a say to stop warehousing of offshore oil discoveries | The Australian: This is designed to stop companies sitting on reserves while they develop other fields, in Australia or overseas.

Under the plans, the outcome after the government decided a project was economic, with the help of other interested parties, would be the same as it is now.

That is, the licence holder would get the chance to develop it now but if it declined, the licence would be forfeited and a production licence offered for sale by tender. The timing of the white paper and any new rules mean it is unlikely to have ramifications where the issue of "commerciality" could next arise; the assessment of Woodside's $30 billion-plus Browse LNG project planned for James Price Point, 60km north of Broome.

Woodside, which appears to be less enamoured in building at James Price Point under new chief executive Peter Coleman, has been told by the federal and West Australian governments that it needs to evaluate whether it is commercial to develop the Browse project there by the middle of next year.

Yesterday, Resources Minister Martin Ferguson said the government's position in relation to whether the project would be viable would be based on departmental analysis.

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