Chevron gears up for Australia LNG expansion

Chevron is looking to expand on its proposed Wheatstone liquefied natural gas project off Western Australia after discovering more gas resources in the area. The US oil major is planning to develop more than 127bn cu m of gas resources in the Carnarvon basin off Western Australia with a new LNG plant and intends to commence front-end engineering next year. The project got a boost last week when Chevron discovered gas in the Iago field close to the Wheatstone gas resources, allowing the Houston-based company to consider building more than one train at the proposed LNG plant. Diamond Offshore’s Ocean Bounty semi-submersible rig discovered 47 metres of net gas pay in the Iago well, drilled in 117 metres of water, just south of the Wheatstone field. Both fields are in a highly prospective area off the coast of Dampier and are a few miles east of Woodside’s Pluto field, which is being developed with a pipeline linked to a new onshore LNG plant near Dampier. &#8220The success of the Iago well, its relatively shallow water and proximity to the nearby Wheatstone gas resource will offer future development options for Iago,&#8221 Chevron Australia managing director Roy Krzywosinski said. &#8220We continue to progress a multi-train Wheatsone LNG and domestic gas development with a view to entering the front-end engineering and design phase next year for a field gas facility.&#8221 If Chevron does move ahead with the Wheatstone development, then it may need to install a couple of production platforms, or it could go with the subsea well option instead. Then there could also be a new pipeline laid to Dampier. The Carnavon basin is teeming with untapped gas resources that oil companies are keen to commercialise and some analysts thought Chevron would be happy to team up with Woodside’s Pluto project, but the US firm is happy to develop Wheatstone and Iago as a standalone project. The fields are east of the Greater Gorgon area, where Chevron, Shell and ExxonMobil have discovered several large gas fields, but political and environmental issues are delaying this multi-train LNG development. Meanwhile, Singapore-listed AusGroup has clinched a $43m contract to build a wellhead platform for Apache’s Reindeer gas project off Western Australia. The platform jacket, piles and topsides will be fabricated at AusGroup’s Kwinana facilities and the Australian Marine Complex in Henderson in the western state. The 3,430-tonne structure is set to be finished in September 2009 and will then be towed out to the field and installed by Clough’s Java Constructor jay barge. A pipeline will take the gas to a new treatment plant at Devil Creek for first production in 2010.

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