Future of Kimberley gas hub down to economics

Tenders for the construction of the $30 billion James Price Point gas precinct have now closed but many questions still loom over the project's future.

A growing number of analysts are suggesting a Broome hub may no longer be the most commercially viable option even as the joint venture partners themselves cannot agree on where to build it.

Analysts like JP Morgan and Citi say behind closed doors Woodside is facing dissent from its joint venture partners who cannot agree on the site and a recent research note from Citi suggests it is no longer the most commercially viable option.

"They estimate it's already 15 billion dollars more expensive to build a new facility at James Price Point than it would be to pipe the gas down to the existing lng facilities in the Pilbara," said Peter Robertson from the Wilderness Society.

It is one of a growing number of investor reports foreshadowing challenging times ahead for Woodside.

The company already delayed a final investment decision from the middle of this year to the middle of next year and the Citi report says getting the go-ahead in that timeframe is still unlikely.

The anti gas hub movement is gathering momentum most recently gaining the support of the Sea Shepherd Conservation Society and high profile businessman Geoffrey Cousins.

As part of its retention lease Woodside has to pick the site which will allow production to begin as soon as possible.

For now that is James Price Point.

As for the joint venture partners, they are choosing their words carefully.

BP has thrown its support behind James Price Point.

Chevron and Shell say they are committed to meeting their lease obligations and BHP said it was leaving all its comments to Woodside.

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