Australia gave final approval on Friday for Woodside to operate the country's oldest and second-largest liquefied natural gas plant until 2070, while imposing 48 "strict" new rules in a bid to limit its environmental impact.
The decision to extend the life of the North West Shelf plant in Western Australia caps a seven-year approvals process dogged by legal action from extremist green groups.
The federal and state governments had to balance that noise with the interests of one of Australia's largest export industries, which is the biggest source of LNG for key ally Japan.
Environment Minister Murray Watt said on Friday Woodside had agreed to 48 conditions that were "technically feasible".
The North West Shelf plant's existing licence had been set to expire in 2030.
The four-decade extension was given preliminary approval in May, but Woodside then battled with the government over the conditions for nearly four months.
Watt said Woodside had agreed to specific limits on pollutants, including cutting levels of nitrogen oxide emissions by 60 per cent in five years and 90 per cent by 2061.
"This final approval provides certainty for the ongoing operation of the North West Shelf Project, so it can continue to provide reliable energy supplies as it has for more than 40 years," said Liz Westcott, Woodside's chief operating officer for Australia.
The North West Shelf LNG plant was Australia's largest until July, when Woodside shut one of its five processing trains, reducing its capacity to 14.3 million tonnes a year as the offshore gas fields that long fed the plant are drying up.
The extension lays the groundwork for Woodside to bring online new supply, including its Browse offshore project, the country's biggest untapped conventional gas resource.
Woodside's partners in the North West Shelf venture are units of BP, Chevron, Shell, Japan's Mitsui Co and Mitsubishi Corp, and China's CNOOC.
Woodside shares closed down 3.4 per cent with oil prices falling.
(Reporting by Christine Chen in Sydney; Editing by Christopher Cushing, Alasdair Pal and Sonali Paul)