LNG projects to start production

Nov 30, 2015


The number of Australian LNG projects in production is set to hit eight by the end of 2016, as the massive wave of investment in the sector turns into export sales.

The Australia Pacific LNG project in Gladstone is set to ship its first cargo by the end of 2015, joining the Queensland Curtis project (which commenced in 2014) and the Gladstone project (which commenced in September this year).

The Queensland projects, all based on development of coal seam gas fields, are due to be followed by two mega projects in Western Australia.

Chevron is in the final stages of commissioning systems to allow start-up of train 1 at its Gorgon project, according to a market update in late October.

“Our current outlook for loading the first LNG cargo is early 2016,” chairman John Watson told a briefing.

That’s a little later than the company had been hoping for, but will nonetheless be a huge milestone for the project, located on Barrow Island off the Pilbara coast.

Production from train 1 will be followed by the completion of construction activity at trains 2 and 3, with the project ramping up to full production over two to three years.

Chevron is targeting the first LNG cargo from its Wheatstone project by year-end 2016 but has signalled that its schedule is under pressure after the late delivery of some modules for the LNG plant.

“We had some modules out of Malaysia that were late, and the team is working very hard to mitigate schedule there,” Mr Watson said.

These new developments add to Australia’s three long-established LNG projects – the North West Shelf and Pluto projects in WA and the Darwin LNG project.

Yet another project under construction is INPEX Corporation’s Ichthys development, which involves construction of an LNG plant at Darwin to process gas from fields off WA’s Kimberley coast.

INPEX announced in November that the laying of its 890-kilometre pipeline linking the gas fields to the LNG plant had been completed.

Shell has taken a very different path for development of its Prelude project, which is based on gas fields located close to the Ichthys fields.

Shell is developing a $10 billion floating LNG plant that the industry hopes will enable development of multiple ‘stranded’ offshore gas fields.

The scope for FLNG will become clearer once Woodside Petroleum completes front-end engineering and design (FEED) studies for its Browse project, also based on gas fields off the Kimberley coast.

Woodside and its joint venture partners, including Shell, BP, Mitsui and PetroChina, are aiming to make a final investment decision by the end of 2016.

If all goes to plan, Woodside intends to develop three FLNG vessels, as an alternative to earlier plans for a land-based LNG plant near Broome, which proved to be highly controversial and ultimately too expensive to develop.


Source:  Mark Beyer, Business News

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