$2bn investment for NW Shelf project

Woodside Petroleum and its joint venture partners have given the go-ahead to a $2 billion subsea development at the North West Shelf Project off the Pilbara coast.

Chief executive Peter Coleman said the approval of the Greater Western Flank Phase-2 project continued a series of subsea tiebacks that were commercialising gas reserves in an efficient manner and extending production volumes for the North West Shelf venture.

"The Greater Western Flank Phase 2 project is an economically robust project that will deliver significant value by leveraging Woodside's experience in delivering major subsea projects," Mr Coleman said in a statement.

It is the fourth major gas development for the massive North West Shelf project in the past seven years, following the $5 billion North Rankin B platform, the Greater Western Flank Phase-1 development ($2.5 billion), and the Persephone gas field development ($1.2 billion).

The joint venture partners, BHP Billiton, Shell, BP, Chevron, and Japan Australia LNG (a joint venture between Mitsui & Company and Mitsubishi Corporation), expect the new project to start up in the second half of 2019.

Gas delivery will initially commence from five wells in the Lady Nora, Pemberton, Sculptor and Rankin fields, followed by the remaining three wells in the Keast and Dockrell fields in the first half of 2020, using subsea infrastructure and a 35-kilometre pipeline connecting to the existing Goodwyn A platform.

The investment comes as oil and gas companies around the world cut back on capital expenditure following steep oil price falls.

Oil prices fell to near seven-year lows overnight as investors look ahead to the US Federal Reserve's December 15-16 policy meeting.

US benchmark West Texas Intermediate for January delivery fell 40 cents to $US36.76 a barrel on the New York Mercantile Exchange.

Woodside shares were 1.4 per cent higher to $27.25 each at 9:30am.