According to a report in last Saturday's West Australian, the US supermajor is holding confidential discussions with several potential industrial customers and is seeking contracts for feasibility and front-end engineering design work.

Chevron declined to confirm this to the West. The company told the newspaper it was considering "a range of development options" for West Tryal Rocks. But as recently as January, the company had said that it believed the Gorgon LNG project to be the field's best path to development.

The retention lease for West Tryal rocks expires on May 28, but it appears the patience of the state and federal Labor parties expired a long time ago, and the election of the Rudd Government means retention leases in Commonwealth waters are now under considerable scrutiny, and none more so than West Tryal Rocks.

The field was discovered by WAPET in 1973, and the fact that it has been undeveloped for so long has irked many potential major gas customers.

Ammonia producer Burrup Fertiliser has repeatedly sought negotiations with Gorgon operator Chevron on a 30-year contract to buy gas from West Tryal Rocks, an undeveloped field in the Greater Gorgon area, about 55km northwest of Barrow Island.

In 2002, the renewal of West Tryal's retention lease was opposed by property development major, the Multiplex Group, because it was prepared to develop the gas field.

In March this year, when Chevron announced its plan to develop its 100%-owned Wheatstone field as part of an LNG development, the company made a reference to developing a domestic gas project without actually saying whether some Wheatstone gas would be used for domestic gas.

"Chevron Australia respects government objectives to develop domestic gas projects and plans to partner with government to achieve this objective," Chevron Australia managing director Roy Krzywosinski said at the time.

"We look forward to working with government to secure timely approvals to facilitate the Wheatstone development and contribute further to Australia's long-term, sustainable economic growth."

Now it appears that Chevron may have been referring to West Tryal and hoping for a quid pro quo from the state and federal governments in terms of fast-tracked approvals.

It appears the Federal Government's use-it-or-lose-it policy in regard to retention leases is producing the desired effect of pressuring LNG players into supplying some gas into the domestic market. But WA's rising gas prices will remove much of the pain for Chevron and other companies placed in this position.

However, given the high levels of nitrogen in West Tryal Rocks gas, Chevron may have long held the opinion that developing the field for the domestic market would not be economic until WA gas prices had risen to their current levels.