Australia on Thursday announced plans to create the world's largest network of marine parks to protect ocean life, with limits placed on fishing and oil and gas exploration off the coast.

The new reserves would cover 3.1 million square kilometres (1.2 million square miles), or more than one-third of Australian waters, taking in significant breeding and feeding grounds.

The announcement, after years of planning and consultation, came ahead of the Rio+20 summit on sustainable development next week in Brazil, which Environment Minister Tony Burke and Prime Minister Julia Gillard will attend.

"It's time for the world to turn a corner on protection of our oceans," Burke said in the lead-up to the meeting, which marks the 20th anniversary of the Earth Summit that declared the environment a priority.

"And Australia today is leading that next step.

"This new network of marine reserves will help ensure that Australia's diverse marine environment, and the life it supports, remain healthy, productive and resilient for future generations."

The network will increase the number of reserves from 27 to 60, expanding protection of creatures such as the blue whale, green turtle, critically endangered populations of grey nurse sharks, and dugongs.

While some limits will be placed on where energy companies can work, tracts of coast off Western Australia, where Shell and Woodside Petroleum recently won permits, will still be open to oil and gas exploration.

It follows warnings from UNESCO that the heritage-listed Great Barrier Reef was at risk of being declared "in danger" due to an unprecedented resources boom which will see a massive increase in ship traffic and offshore industries.

The Australian Conservation Foundation welcomed the reserves initiative, calling it "a historic achievement", but said it was concerned that some areas remained under threat.

"Although the reserve network bans oil and gas exploration in the Coral Sea, the northwest region has been left vulnerable to these threats," said chief executive Don Henry.

The Wilderness Society called the announcement a first step, and said it was "clear that further marine sanctuaries will need to be put in place".

"Our oceans are under constant pressure from trawling, overfishing, oil and gas developments and seabed mining," said marine campaign manager Felicity Wishart.

But fishermen were up in arms, claiming coastal communities would be ruined, thousands of jobs lost and the Aus$2 billion (US$2 billion) aquaculture industry seriously impacted.

The Australian Marine Alliance, which has conducted a cost analysis, claims 60 regional communities will be affected, 36,000 jobs lost and 70-80 trawler operators displaced, while the cost of seafood imports will soar.

"This is devastating and those that will suffer most will be coastal communities," said Dean Logan, head of the alliance which represents commercial and recreational fishers.

Burke disputed the impact on fisheries.

"Reserves have been designed to minimise the impacts wherever possible. The reserves are estimated to displace approximately 1-2 percent of the annual value of wild catch fisheries production in Australia," he said.

He added that around Aus$100 million in compensation would be available to the fishing industry.

A final consultation period of 60 days is now scheduled with the new reserves expected to be officially declared before the end of the year.