Gorgon gas project

Gorgon gas project is a project for developing Greater Gorgon gas fields in the Carnarvon Basin in the North West Shelf about 130 kilometres (80 mi) off Western Australia, and for construction of a LNG plant on Barrow Island.

History

The Gorgon field was found in 1980, following the discovery of the West Tryal Rocks field in 1973 by WAPET. On 7 September 2007, the Gorgon gas project was approved by West Australian Minister for the Environment, and on 10 October 2007, by the Australia's Federal Minister for the Environment.

The project was given a major boost in August 2009 with the signing of an $50 billion export contract between PetroChina and ExxonMobil. The deal is one of the largest investments made in Australia and according to Martin Ferguson, Minister for Resources and Energy, it will be one of the nation's biggest construction projects.

Gas fields

Greater Gorgon gas fields are located approximately 65 kilometres (40 mi) to 134 kilometres (83 mi)offshore from Barrow Island and approximately 200 kilometres (120 mi) west of Dampier on the Australian mainland. Gas reserves in the Greater Gorgon fields are estimated to exceed 1.1 trillion cubic meter. To date, five significant fields have been discovered: Gorgon, Chrysaor, Dionysus, West Tryal Rocks and Spar. To the north is the North West Shelf Venture which was established in 1984.

Technical features

The project involves a development of up to 30 subsea wells in water depths from 200 metres (660 ft) to 1,300 metres (4,300 ft). The subsea equipment will be supplied by Vetco Gray. The subsea production facilities will be connected to the LNG plant at Barrow Island by subsea pipelines. In addition to the Gorgon feed pipeline, the pipeline from the Io/Jansz offshore gas field would be built. The LNG plant will consist of three LNG trains with total capacity of 15 million tonne of LNG per annum. It is expected to be commissioned by mid 2011. The complex will also include LNG shipping facilities and greenhouse gas management using carbon sequestration into geological formations beneath Barrow Island. The project foresees an assessment of a domestic gas plant and pipeline to the mainland. Initially the project was expected to cost around A$11 billion, but it is possible that final costs could be twice this amount.

Project company

Chevron Corporation, with a 50% interest, is the operator of the development on behalf of the Gorgon Venture partners. Other partners are ExxonMobil and Royal Dutch Shell each hold 25% stakes. In 2000, Chevron inherited the assets of WAPET, an early Western Australian oil exploration operation.

Supply contracts

The LNG plant production will be sold to customers in China, India, Japan and South Korea. India's Petronet LNG had signed contract with ExxonMobil to buy 5 million tonne of LNG per annum from the Gorgon LNG plant. Also India's GAIL is in talks with ExxonMobil over buying liquefied natural gas for the Dabhol power plant. PetroChina has agreed with Shell to buy 1 million tonne of LNG per annum. Osaka Gas will buy 1.5 million tonnes of liquefied natural gas per annum and Korea's GS Caltex will buy 0.25 tonnes of liquefied natural gas per annum from Chevron.

Timeline

• 2009 08 10 - (Perth), signed a Sales and Purchase Agreement with Petronet LNG for the supply of 1.5 million tonnes of LNG per annum for 20 years to Kochi LNG Terminal, India. [1]

Controversy

The project has been criticized by conservation groups as it has an impact to the Barrow Island nature reserve, which is home to the threatened flat-backed turtle and 21 different species of animals.

External links

• Gorgon Project website