A campaign fronted by the author Tim Winton and backed by environmentalists and ecotourism operators is attempting to stop a pipeline factory for the oil and gas industry proposed for Exmouth Gulf, next door to Western Australia’s world heritage-listed Ningaloo Reef.

They say the proposal by the engineering company Subsea 7 would lead to 10km steel pipe bundles containing gas and communication lines being transported through the gulf to offshore gas fields, putting at risk coral beds and affecting hundreds of species in what is recognised as a nursery and foraging area for the marine life found on the reef. The vast gulf – 2,600 sq km – is virtually undeveloped and home to dugongs, manta rays, calving whales and extensive mangroves used by many species for breeding.

Project supporters say this is an unfair categorisation of a development that would have little environmental impact and that it would be a boon for Exmouth, a resort town that has not had the resources-based investment experienced further north in the Pilbara. Subsea 7 says at peak production it would add an estimated 120 full-time jobs to a town with a population of about 2,500.

The result is a local take on an age-old argument: to develop or to conserve. Winton, the patron of a group known as Protect Ningaloo, said the proposal would do significant environmental damage and open up the pristine gulf environment to further industrial development. He points to the area’s world heritage values.

In 2010 the International Union for the Conservation of Nature recommended that the gulf be considered for inclusion in the Ningaloo world heritage area due to its importance as a nursery for reef species. The Ningaloo coast – including what, at 260km, is one of the world’s longest near shore reefs – was listed by Unesco in 2011. The gulf wasn’t.

“It makes me sad that some of the leadership in Exmouth have Pilbara dreams for their own bit of paradise,” Winton said. “It is a short, sharp drop from eco to Fifo [fly-in, fly-out], but it’s permanent.”

Subsea 7 said it could not respond to questions about the project by publication but provided a company document that explained the factory would be built about 10km from the gulf beach at Heron Point. The pipe would be transported via rail track to a concrete and rock launching point that would extend 300 metres into the gulf.

It says the pipe would be launched by tug boat, that steel pipes would never touch the seabed and pipe bundles would not be launched in whale migration season. Based on its experience at its existing operation in Scotland, the company says it expects to launch one or two bundles a year.

The chairman of Exmouth Chamber of Commerce and Industry, Barry Sullivan, who led the organisation’s opposition to Ningaloo Reef’s world heritage listing in 2011, said business leaders were confident the project would be of huge benefit to the local community. He stressed Subsea 7 had promised to hire local workers wherever possible.

Both he and the shire president, Matthew Niikkula, said the project was being scrutinised by the WA Environment Protection Authority, and they would accept its findings. Sullivan hoped further development would follow, including the creation of a deepwater port for cruise ships and other vessels.

“I personally don’t believe it’s going to have any environmental impact of any sort, but we will let the umpire make that decision and respect it,” Sullivan said. “Our concern for the bigger picture is if the project doesn’t get up it doesn’t bode well for any other development in the area getting up.”

Niikkula said a misplaced belief it was a fossil fuel company was driving some of the hostility to the development. “The opponents are trying to say they don’t want oil and gas here when the reality is, it’s a manufacturing company. If it was manufacturing steel roof beams no one would be jumping up and down,” he said. “We don’t want fly-in, fly-out workers, we want people to be able to live here and work here and put their kids in school here.”

But Brett Wolf, a high-end fly-fishing guide whose clientele travel from across the globe to fish in the gulf, said the project would have a massive impact on ecotourism businesses like his.

“People don’t come to these wilderness places to see a factory,” he said. “There are plenty of industrial places in Western Australia you can do this but we’re running out of these pristine places.”

Piers Verstegen, of the Conservation Council of Western Australia, emphasised the “absolutely fundamental” role the gulf played in maintaining Ningaloo’s health. He accused Subsea 7 of naivety in choosing the development site, saying it had failed to grasp both the history of the area and level of community concern.

“It’s just the wrong place for it,” he said. “If this was a bigger company with a social risk profile, such as Woodside, they wouldn’t dream of putting it there.”

The state EPA is considering both the development itself and a change to the shire’s planning regime that would allow industrial projects on the proposed site. The project is also expected to need approval under the federal Environment Protection and Biodiversity Conservation Act.