Big announcement for Broome

Big announcement for Broome

Posted on Thursday, July 19 2012 at 10:55 AM

Broome’s controversial James Price Point liquefied natural gas (LNG) processing plant is one step closer to moving ahead, following conditional approval from the Environmental Protection Authority (EPA) on Monday.

The decision to base the gas
processing hub onshore south of James Price Point in Broome, with direct access
to the Browse Basin, has divided the community – one half of the community is
outraged over the potential damage to the pristine Kimberley land and surrounding
sea environment, while others prefer to look at the issue from a dollar
perspective and the enormous job opportunities to flow into the town.

WA Acting Premier Kim Hames says
Woodside Energy and the Western Australian Government have spent four years
studying the environmental and natural heritage issues.

In late 2010 the results of
environmental studies and proposed strategies for managing environmental
impacts were released for a 15-week public comment period, says Hames.

“In the year since, public
submissions have been considered, responses prepared and new studies and
monitoring undertaken and provided to the EPA.”

On Monday this week the EPA gave
the green light to the project, with environmental conditions in place.

The EPA’s report will now be open
for a 14-day public consultation period before the WA Environment Minister Bill
Marmion will consider the findings and determine any appeals, including those
from environmental lobby groups, before making a final decision.

From this point the project start
is subject to Commonwealth approval and also Woodside’s final investment
decision, which the company claims is on track to happen in the first half of
next year.

If all goes ahead, Woodside
Energy estimates it will build and operate a 12-million-tonne per annum LNG processing
facility at the site.

While the volume is significant,
Woodside says it will still be smaller than its North West Shelf LNG project
located at Karratha, though if it expands it could exceed it.

Residential valuer Stephen
Incerti of Opteon Broome doesn’t expect major price surges if the LNG project
goes ahead near James Price Point.

Firstly, he says the WA
Government has already released blocks of land to cater for the population
growth anticipated from the LNG project, enough to “double the size of Broome”.

He adds that the government has
enough land to release for another 15 years, though when or if the final go
ahead is given there may be an initial price spike while housing is being
constructed and investors flood the market.

“On the other hand, if the
project doesn’t go ahead it could mean a fair bit of oversupply for Broome.”

The WA Government is releasing
large supplies of land in anticipation of the project, with the first stage
almost sold out in the Broome North suburb development, says Incerti.

Investors must remember that the
government has strict conditions on releasing these blocks to avoid speculators
flooding the market – buyers must occupy the new home for a minimum of 36
months before renting it out, he says.

The other consideration investors
need to make is if the LNG project does go ahead Woodside will build a workers
camp for its construction workers near the James Price Point site, says
Incerti.

A Woodside Energy spokespersons
reports that a 6000-bed, fully self-contained accommodation facility with a
wide range of amenities would be constructed for the construction stage to
accommodate the expected onshore construction workforce of about 6000.

Once LNG production begins
between 400 and 600 permanent jobs are expected.

“We’re talking 60 kilometres away
from Broome. Though once you have a project of this scale on your doorstep it
stimulates other industry, which means even more jobs for the area,” says
Incerti.

Helen Collier-Kogtevs of Real
Wealth Australia says investors should hold off on speculating in Broome at
this stage.

“Until the project is a done deal
and the money is on the table and the final contracts are signed and jobs are
starting, investors shouldn’t get caught up in hype of big announcements.”

She adds that investors need to
thoroughly investigate the market including the land supply.

“I would rather my clients pay
$50,000 more for an investment property once it’s a sure thing rather than
being a fox and trying to get ahead of the pack and getting unstuck because it
didn’t happen and they couldn’t get a tenant.”

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