Federal Environment Minister Tony Burke has given environmental approval for Shell's Prelude Floating Liquefied Natural Gas Project in the Browse Basin with strict conditions.
Federal Environment Minister Tony Burke has given environmental approval for Shell's Prelude Floating Liquefied Natural Gas Project in the Browse Basin with strict conditions.
Mr Burke said he took into consideration the significant economic benefits of the project when making the decision.
"I have looked at this proposal and the advice of my department carefully, and determined that the Prelude floating LNG facility would be acceptable under national environment law," said Mr Burke.
"This is a large-scale project that is using world-first technology.
"We can't risk getting it wrong, so I have set very strict conditions to help ensure our precious marine environment will be protected," he said.
Shell in Australia country chair Ann Pickard welcomed the news.
"Receiving environmental approval is an important milestone as we continue to work on the development of the Prelude Project," she said.
"Deploying our Floating LNG technology reduces the Project's cost and environmental footprint, as it removes the need for offshore compression platforms, long pipelines to shore, nearshore works such as dredging and jetty construction, and onshore development such as building roads, laydown areas and accommodation facilities."
However, Mr Burke said there were several conditions which Shell must meet.
Shell must develop an oil spill contingency plan, develop a greenhouse gas strategy and implement measures to reduce light pollution.
"Shell will also be required to submit -- and make publicly available -- an environmental performance report detailing how it has adhered to the approved plans and strategies, and my department will be able to audit the project at any time to ensure the company is complying with the approval conditions," said Mr Burke.
The project is approximately 200 kilometres offshore in the Browse Basin.
The facility is designed to extract and process natural gas and associated condensate, thereby avoiding the need for a "traditional" development comprising off shore platforms, export pipelines, an onshore liquefaction plant and export jetty.
Shell hopes to start production in 2016.
The project is expected to have a life of 25 years and annual production is estimated to peak at 3.6 million tonnes of LNG, 1.3 million tonnes of condensate and 0.4 million tonnes of Liquefied Petroleum Gas.
Greens Senator Scott Ludlam said the strict conditions are non-existant.
"Minister Burke has given the green light to Shell's Prelude project claiming this high greenhouse gas-emitting, high risk project will go ahead under strict conditions but his own press release goes on to reveal nothing but hazy promises and non-existent conditions," he said.
"As Shell's own draft environmental impact statement makes clear, the liquefied natural gas to be tapped from this project is especially high in carbon dioxide, which Shell proposes to strip from gas coming out of the seabed and vent straight into the atmosphere.
"There are appears to be no suggestion from either Shell nor the Federal Government that anything will be done about capturing the project's emissions, which alone will add nearly half a per cent to Australia's total annual greenhouse gas emissions - this at a time when Australia has committed to reducing our annual greenhouse gas emissions by five per cent in 10 years' time."
Shell last week told WA Business News that it did not believe geosequestraton of carbon was a viable option at Prelude and that it intended to mitigate CO2 emissions largely by purchasing permits under an emissions trading scheme.
Notwithstanding the current political impasse, Shell said it expected such a scheme would be implemented in Australia by 2016.
Prelude is expected to emit 2.3 million tonnes of CO2 annually at full LNG production.
