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Gorgon liquefied natural gas project, Australia

20th March 2015

  

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Name and Location
Gorgon liquefied natural gas (LNG) project, Barrow Island, Australia.

Client
The Gorgon Project is operated by an Australian subsidiary of Chevron (47.3%), in joint venture (JV) with the Australian subsidiaries of ExxonMobil (25%), Shell (25%), Osaka Gas (1.25%), Tokyo Gas (1%) and Chubu Electric Power (0.417%).

Project Description
The $52-billion Gorgon project currently includes the construction of a three-train, 15.6-million-tonne-a-year LNG plant on Barrow Island with the capacity to supply 275-million standard cubic feet a day of natural gas to the Western Australian market.

The Gorgon JV participants are progressing environmental approvals for an expansion of the project, which will increase LNG production from 15.6-million to 20-million tonnes a year.

The expansion will involve drilling new production wells and installing new subsea infrastructure in Commonwealth waters, the construction of a new feed gas pipeline system, and the addition of a fourth LNG train and associated infrastructure at the company’s existing gas treatment plant on Barrow Island.

Existing infrastructure constructed as part of the original project will be used to export products generated by the fourth-train expansion proposal.

Value
The Gorgon project is estimated at $54-billion.

The expansion is estimated at $10-billion.

Duration
Plant start-up and first gas from the Gorgon project is planned for mid-2015.

A timeframe for the expansion project has not been confirmed.

Latest Developments
The Western Australian Environmental Protection Authority (EPA) has supported US major Chevron’s plans to expand the Gorgon gas development to a fourth train, which will increase LNG production from 15-million to 20-million tonnes a year.

The fourth-train expansion proposal is expected to cost an estimated $10-billion.

“Horizontal directional drilling (HDD), offshore gas pipeline installation activities and the fourth-train operation have the potential to impact on the environment,” says EPA chairperson Dr Paul Vogel.

“The EPA carefully assessed the potential impacts to marine environmental quality, marine fauna, air quality and benthic communities and habitat and found that the proposal could be managed to meet the EPA’s objectives subject to the conditions in the existing Ministerial statements issued for the original project.

“These conditions include management plans for marine environmental quality, HDD activities, gas pipeline installation, marine fauna, air quality and greenhouse-gas abatement.”

Key Contracts and Suppliers
Kellogg Joint Venture (JV) Group, comprising Clough, JGC Corporation and Hatch & Associates (front-end engineering, design and engineering, procurement and construction management contract); Hyundai Heavy Industries (modules and three preassembled units); Howard Porter (trailers); Toll Group (supply base and logistics services); Thiess, Decmil Australia and Kentz JV (construction village); Ertech (marine and onshore work, road improvements, earthworks, water facilities and telecommunications tower installations); Thiess (site preparation for the LNG plant, expansion of logistics infrastructure and temporary construction facilities); DB Schenker (integrated logistics services, including sea-chartering services, the air transport of freight and the consolidation of materials and equipment); Agility Project Logistics (supply base operations and transportation services); Cobham Aviation Services Australia (operation of jets and aircraft); Bristow Helicopters Australia (helicopters); Osmoflo (reverse-osmosis (RO) desalination plants); Sinclair Knight Merz (SKM) (monitoring marine environment); Health Services Australia (medical services); BJ Services (precommissioning services); Aker Solutions (subsea umbilicals and associated equipment); Offshore Oil Engineering Company (fabrication of pipe-rack modules); McDermott International (preassembled racks and units, as well as the fabrication of subsea structures and spools); Air Products (cryogenic heat exchangers); MTU Detroit Diesel (standby power); Monadelphous (water-treatment facility); China Offshore Oil Engineering Corporation; Monadelphous through KT Pipelines Services (transmission pipelines); Neptune Marine Services (dive and vessel support services); AGR Drilling Services, contracted by Van Oord Australia (excavation services on the Jansz Scarp); Noskab (power cables); Fairstar Heavy Transport (heavy transport vessels for modules); AJ Lucas (horizontal directional drilling); Boskalis Australia (dredging work and construction of material offloading facility); Westralian Engineering (maintenance, repair and refurbishment work for Boskalis Australia); and Theiss (miscellaneous civil work).

On Budget and on Time?
The plant’s expected cost was estimated at $37-billion when it was launched in 2009, increased to $52-billion and then to $54-billion in 2014.

Contact Details for Project Information
Agility Project Logistics investor relations, email investor@agilitylogistics.com.
AGR Drilling Services, tel +47 56 31 6000 of fax +47 56 31 6001.
AJ Lucas, tel +61 7 3363 7333 or fax +61 7 3363 7399.
Air Products, tel +1 610 481 8315 or fax +1 610 481 2729.
Aker Solutions, tel +47 67 51 3039 or cell +47 91 13 7194.
Boskalis Australia, tel +61 8 9327 1000 or fax +61 8 9226 0213.
Bristow Group, tel +1 713 267 7600 or fax +1 713 267 7620.
Bristow Helicopters Australia, tel +61 8 9478 3388 or fax +61 8 9478 3844.
Chevron Australia, tel +61 8 9216 4000, fax +61 8 9216 4166 or email gorgon.info@chevron.com.
Clough, tel +61 8 9281 9344 or fax +61 8 9481 6699, cell +61 417 451 724.
DB Schenker corporate communications, tel +49 201 8781 0, fax +49 201 8781 8334 or email info@dbschenker.com.
Decmil Australia, tel +61 8 9368 8877, fax +61 8 9368 8878 or email enquiries@decmil.com.au.
Ertech, tel +61 8 9302 6666, fax +61 8 9302 6100 or email ertech@ertech.com.au.
Fairstar Heavy Transport, tel +31 10 403 5333, fax +31 10 403 5344 or email fairstar@fairstar.com.
Hatch & Associates, tel +61 8 9410 3306 or fax +61 8 9410 3290.
JGC Corporation, email ir@jgc.co.jp.
HHI, tel +82 746 4775 or +82 746 7415, fax +82 746 4662 or email hhiir@hhi.co.kr.
Howard Porter, tel +61 8 9418 0000 or fax +61 8 9418 5383.
Kentz investor and public relations Elizabeth Rous, tel +44 20 3159 4000 or email elizabeth.rous@kentz.com; or Catríona Nugent, tel +353 52 61 22811 or email catriona.nugent@kentz.com.
KT Pipelines Services, tel +61 8 9250 2161, fax +61 8 9250 1024 or email info@kt.com.au.
McDermott International investor relations and corporate communications director Robby Bellamy, tel +281 870 5165 or email rbellamy@mcdermott.com.
Monadelphous, tel +61 8 9315 7429 or cell +61 457 539 985.
Neptune Marine Services, tel +61 8 9424 1111, fax +61 8 9424 1110 or email info@neptunems.com.
Noskab, tel +44 1 22 485 4100 or fax +44 1 22 485 4104.
Osmoflo, tel +61 7 3623 6800.
SKM, tel +61 8 9469 4400 or fax +61 8 9469 4488.
Thiess, tel +61 7 3002 9000, fax +61 7 3002 9009 or email feedback@thiess.com.au.
Toll Group, tel +61 3 9694 2888 or fax +61 3 9694 2880.
Van Oord Australia, tel +61 7 3369 1988, fax +61 7 3368 3904 or email loc.bne@vanoord.com.
Westralian Engineering, tel +61 8 9437 5455, fax +61 8 9437 5477 or email info@weseng.com.au.
Theiss media contact Alex Smith, +61 7 3002 9673 or email asmith1@thiess.com.au.

Edited by Creamer Media Reporter

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