Western Australia has secured more domestic gas supply under a deal with resources giant Woodside for the construction of a new onshore pipeline.
The five-kilometre, 76-centimetre interconnector will allow Woodside to process gas from its offshore Pluto field at the Karratha Gas Plant in the Pilbara region.
An average of 250 workers will be employed during the construction with the workforce expected to peak at 320, Woodside said on Friday.
Construction has begun and pipeline is expected to begin operating next year.
Under an agreement with other participants in the North West Shelf Project, Woodside will process about three million tonnes of LNG over four years from next year.
It has committed to reserve gas equivalent to 15 per cent of its LNG exports for the domestic market in line with WA’s reservation policy.
An additional 45.6 petajoules of gas will be made available to the domestic market from 2025 from its North West Shelf supply.
“These agreements with Woodside reinforce our domestic gas policy and provide certainty for LNG industry investors and domestic gas consumers,” Premier Mark McGowan said on Friday.
“This is another sign that confidence has returned to Western Australia, and my government will continue to work to facilitate job-creating projects that support the economy.”
Woodside chief executive Peter Coleman said the interconnector was the first step towards “realising our vision for a regional LNG hub on the Burrup Peninsula”.
“As the world continues to respond to COVID-19 and volatile market conditions, it is critical that operators and government work together to grow the gas industry, create local jobs and establish Western Australia as a global LNG hub,” he said.
Environmentalists have vowed to fight the proposed $43 billion Burrup Hub mega-project, which centres on the development of the Browse and Scarborough offshore gas fields via the North West Shelf and Pluto gas plants.
WA’s Conservation Council last month launched a challenge in the Supreme Court against Woodside and the state government, claiming environmental approvals granted for the project may breach the Environmental Protection Act.
The council has also expressed concern about the potential impact it could have on ancient Murujuga rock art.
Woodside said it had complied with regulatory requirements and environmental processes and intended to vigorously defend itself.