Browse a Gray area

Australia's new Resources Minister, Gary Gray, has spent his first day on the job trying to hose down suggestions that he will push for a change of strategy in the development of the controversial $30 billion Browse LNG project.

Mr Gray was appointed to the portfolio following Friday's resignation of Martin Ferguson, but quickly discovered on Monday that assumptions about some of his policy preferences were firmly entrenched.

Mr Gray was forced to immediately play down suggestions that he would campaign for offshore development of the Browse gas project, which is being developed in the Kimberley by Woodside Petroleum, Royal Dutch Shell and smaller joint venture partners from Japan and China.

Approvals granted by state and federal governments require the gas hub to be constructed at the environmentally sensitive James Price Point near Broome, but the companies involved - particularly Shell - are understood to want to process the gas using a modern floating vessel.

Mr Gray was recently reported as supporting Shell's offshore ambitions when he praised Australia's oil and gas industry for enthusiastically adopting technological developments like floating LNG processing and coal seam gas production.

Speaking to Fairfax Media on Monday, Mr Gray stressed the comments were not meant to be interpreted as support for offshore development of Browse.

But when asked to clarify which option he preferred for Browse, Mr Gray was non-committal.

"I will be the decision-maker on the extension lease for James Price Point and consequently it just isn't appropriate for me to comment specifically on that project and on the Browse development," he said.

Mr Gray's ambiguous stance on Browse is at odds with WA Premier Colin Barnett, who has insisted that he will not support the project unless the processing hub is built onshore.

The issue is likely to flare again in coming months, as the joint venture partners make a final investment decision on the onshore concept.

The notion that Shell might be the beneficiary of Mr Gray's appointment to the position of Resources Minister is ironic, given he is widely credited with stifling Shell's attempts to takeover Woodside in 2001.

Woodside hired Mr Gray to help lobby the Howard government into disallowing the takeover on national interest grounds.

Mr Gray succeeded, and spent the next six years with Woodside before entering federal Parliament as the member for Brand in 2007.