Energy giants ink Aust LNG accord

Business, Main Stories

The National

SYDNEY: Energy giants Chevron, Shell and ExxonMobil yesterday agreed to develop Australia’s massive Gorgon field, giving the final go-ahead to a liquefied natural gas (LNG) project worth hundreds of billions of dollars.
Chevron said the joint venture partners would start work immediately on the plant, pumping A$43 billion (K102 billion) into the initial construction phase.
Prime minister Kevin Rudd said the project off Australia’s northwest, which is expected to begin production in 2014, would provide a valuable source of jobs and exports.
“The Gorgon investment will be Australia’s largest-ever resources development and is expected to generate A$300 billion (K708 billion) in Australian export earnings,” he said in a statement.
The project is already underpinned by supply contracts with China, Japan, India and South Korea worth a combined A$145 billion (K342.22 billion), including ExxonMobil’s record A$50 billion (K118 billion) deal with PetroChina.
“Gorgon will supply cleaner burning natural gas for the growing Asia-Pacific and Australian markets, create thousands of jobs, and generate substantial revenue for Australia,” senior Chevron executive Jim Blackwell said.
Gorgon, the world’s largest LNG plant, will be built on Barrow Island, a nature reserve about 70km off Western Australia.
The Australian government approved the project last month after imposing strict environmental conditions.
ExxonMobil said Gorgon had an estimated 40 trillion cubic feet of natural gas, providing an important source of energy for Asia’s burgeoning economies.
Chevron owns a 50% stake in Gorgon and will operate the plant, with ExxonMobil and Shell each holding 25%. – AAP