WA critical for offshore gas growth: BHP boss Colin Barnett and Steve Pastor at the opening of the Macedon gas plant near Onslow in Western Australia yesterday. Picture: Colin Murty Source: TheAustralian THE head of BHP Billiton's conventional gas assets says offshore Western Australia will remain central to its growth options as he foreshadows plans to double the production capacity of the company's new $US1.5 billion ($1.6bn) Macedon gas plant. Steve Pastor, a Houston-based executive, rejected suggestions that BHP would neglect its conventional gasfields in offshore WA in favour of investing in the US shale gas boom. "The advantage Western Australia has is it's got fantastic resources," Mr Pastor said. "It's got decades-long experience in oil and gas and its proximal to the market," he said. WA Premier Colin Barnett yesterday officially opened the Macedon plant, near the Pilbara town of Onslow. The first gas at the BHP-operated facility was produced last month. It has a production capacity of up to 200 terajoules of gas a day, but Mr Pastor said this could double to 400TJ a day as part of an expansion plan. Macedon is a joint venture between BHP (71.4 per cent) and Apache (28.6 per cent). Apache also built the $1.1bn Devil Creek domestic gas plant, south of Karratha, which opened last year. Major industrial gas users in WA have long complained of a shortage of gas at reasonable prices, although the commissioning of Macedon will help alleviate those concerns. Mr Barnett said he saw no reason to change the state's policy of forcing LNG producers to reserve 15 per cent of gas for the domestic market. He said there was some concern that by 2016, WA could have a gap in supply before gas was produced from Chevron's Gorgon and Wheatstone projects. "Gorgon and Wheatstone will help fix that as they come into production," he said. These projects (such as Macedon) at this size are targeted at the domestic market and are the key to long-term gas security for WA. Increasing supply will bring prices down. Mr Pastor said he favoured the "free market" rather than reservation policies. "BHP Billiton believes in free markets and that free markets will ultimately determine which resources are best to develop and how best to distribute them," he said. Mr Pastor said all of Macedon's gas would be fed into WA's general domestic network. But it is understood that much of BHP's share of the gas will be sold to the company's mining operations in WA. The Macedon plant opening came as BHP and Exxon Mobil this week agreed to sell $3bn of Bass Strait gas to Origin Energy at oil-linked prices in the most valuable east-coast domestic gas deal to date. The deal represents the equivalent of more than a third of NSW demand over its nine-year life. It also cemented higher prices for east coast gas users.