Business

Woodside Petroleum shelves $40bn Australia LNG project

Woodside operated North West Shelf Venture on the Burrup Peninsula in the north of Western Australia
Image caption The company said it would look into a floating liquefied natural gas facility instead

Australia's second biggest oil company, Woodside Petroleum, has put a $40bn (£26bn) proposed liquefied natural gas (LNG) project on hold.

The project would have processed gas from the Browse Basin, in Western Australia, into LNG for export to Asian utilities.

Woodside said the decision to put off the project was a commercial one.

The project had faced opposition from environmental groups concerned about potential damage to the area.

The company said it would look into alternatives including a floating liquefied natural gas facility instead, along with joint venture partner Royal Dutch Shell.

The Woodside project was one of dozens of gas export terminals planned in Australia.

However, analysts said the decision to put the project on hold was another setback for the fledgling industry.

Wages in Australia and the strong Australian dollar have made LNG projects extremely costly. The Woodside project was one of the most expensive in the world.

The country also faces competition from other LNG resources discovered in Canada, the US and east Africa.

However, Australia is projected to becomes the world's largest supplier of natural gas, overtaking Qatar, by the end of the decade.

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