Speaking at a petroleum briefing in Sydney on Monday, Yeager said all the engineering for the 800 billion cubic feet project was in the final stages of completion with sanction expected mid-year.

"We're in the final stages of doing our detailed design and we hope to move that to execution in the next couple of months."

Yeager added that the regulatory approvals were moving forward and first gas was on target for 2013 at rates of 200 million cubic feet per day.

The Macedon gas field was discovered in 1992 by the West Muiron-2 well with a follow-up appraisal campaign in 1994. The field is 10 kilometres from BHP's producing Pyrenees oil development.

Front-end engineering and design for Macedon was awarded to Clough last September. Clough studied the development concept based on four subsea wells routed via an 85km subsea wet gas pipeline to an onshore gas plant.

The gas will be processed before being piped into the Dampier to Bunbury Natural Gas Pipeline.

BHP Billiton owns a 71.43% interest and is operator of WA-12-R, where Macedon is located, with partner Apache Energy holding 28.57%.