The Browse project presents an "extremely competitive" option to provide gas to the North West Shelf LNG plant, Woodside Petroleum chief executive Peter Coleman says, as it prepares to pit the long-awaited development against others in the region competing to be picked up by the valuable export hub.
After abandoning plans to develop the project as a floating venture, the Woodside-led Browse joint venture is considering a plan to develop the resource by piping it more than 800 kilometres to the North West Shelf, which is also operated by Woodside and will need new sources of gas from about 2020.
Mr Coleman said the "compelling option" could be achieved relatively quickly and cheaply but it would need to compete with other undeveloped resources in the region, including the Scarborough field which Woodside paid $US400 million for a stake in last year.
"Basically there are three or four joint ventures out there who have undeveloped resources, they will receive an offer from the North West Shelf partners for a tolling structure and then will be asked to basically tender into that offer and provide their terms and conditions for getting into the North West Shelf," Mr Coleman told reporters after Woodside's annual meeting in Perth on Friday.
"The North West Shelf will then value that. My view is Browse is extremely competitive in that."
But Mr Coleman said receiving consensus approval from the six partners in the North West Shelf – Woodside, Shell, BP, BHP Billiton, Chevron and Japan Australia LNG (itself a joint venture between Mitsui and Mitsubishi) – was Browse's "next challenge".
BP, Shell and Japan Australia are also partners in Browse along with PetroChina.
"I am quite optimistic," he said. "We have had a number of discussions over the last 12 months and hit it particularly hard this year not just at the venture level in Australia but more importantly globally and going back to the parent companies of those partners and making sure we have conversations with the decision-makers.
"That is why I said I am more positive than I have been for a long time about, one, what we are going to do at the North West Shelf and, two, where Browse is going. Equally we have some way to go but we are very much targeting having most of it behind us by the end of this year."
It came as Woodside comfortably avoided facing a spill resolution after its shareholders voted 98.6 per cent in favour of its executive pay. The overwhelming show of support for the resolution prevented a second consecutive "strike" on Woodside's remuneration report, which could have triggered a vote on spilling the board.
Proxy adviser ISS, which last year recommended shareholders vote against Woodside's executive pay, backed the report this year, noting the board's "proactive engagement" with shareholders and steps taken to address concerns.
A number of proxy voters at the meeting spoke to oppose former federal resources minister Ian Macfarlane's appointment to the board on environmental grounds, which chairman Michael Chaney declared "a pity" given those people "actually aren't asking about their interest as shareholders but about some particular narrow issue".
Commenting on a question about high industry-wide chief executive salaries, Mr Chaney said executive salaries had been inflated because of the requirement they be publicly disclosed, which has created competition.
"When you appoint a new CEO these days you tend to pay them less than the last one, and that has happened in various companies across Australia in the last few year or two, and I think will be a continuing trend," he said.
"But I do think the large differential that we see is going to take a long time to correct."
