Surplus gas supplies raised
Woodside Petroleum has made clear for the first time it is talking to the Gorgon project partners about diverting surplus gas to keep the North West Shelf at full LNG production capacity beyond the end of this decade.
Woodside has identified up to eight trillion cubic feet of gas in the Chevron-run Greater Gorgon area as “unallocated volumes”, along with 3.5tcf in the Clio-Acme fields (part of Chevron’s greater Wheatstone area) and 4tcf in another suite of Chevron-operated fields, including Geryon and Orthrus.
Chevron is one of the NWS partners, as are its main Gorgon investors Royal Dutch Shell and ExxonMobil.
The five-train NWS at Karratha, which is Australia’s biggest LNG operation, needs an injection of new gas from as early as 2019 to keep it full.
Woodside, the NWS operator, is already talking to Hess about tolltreating 2tcf from the Equus field and is also hoping for its own exploration success.
Speaking in Sydney at Woodside’s annual investor briefing day recently, chief executive Peter Coleman highlighted the value of owning existing processing plants — the Perth company also runs the Pluto operation — and talked up the NWS as a “world-class lowest cost plant (with) capacity available (for) other resource owners’ gas”.
But Mr Coleman all but ruled out using gas from the long-stranded Browse fields as NWS backfill, making clear his company’s focus remained on a phased floating LNG development for the three fields off the Kimberley coast that contain 16tcf and 466 million barrels of condensate.
Mr Coleman said he expected to complete the concept select milestone, detailing how to structure a phased development of the Browse fields, by the second half of next year.
He did not reveal more details other than to hint the “highest value” start-up would likely focus on the Calliance or Brecknock fields, and not the more complex Torosa, and that Woodside was talking to various FLNG technology developers to find a cost-effective solution.
A deal with Browse project partner Shell to use the design one, build many technology based on the Anglo-Dutch giant’s five-yearold Prelude project, was terminated in March.
Mr Coleman, who said Prelude’s technology had already been superseded by newer and better versions, said Shell itself was working on a new model, though he was yet to see it.
“(Prelude) was serial No. 1, it was a technology that we observed at the time was designed well,” he said. “It was a conversative technology to make sure it worked and delivered on its promise, it was not that well slimmed down for offshore.”
Woodside is hunting for cost-saving capital and operating modifications such as a shorter vessel (325m to 350m) than the 488m-long Prelude to enable more shipyards to tender for the construction, as well as greater LNG throughput.
The massive Browse resource means the project remains front and centre of investors’ minds as they ponder where the next step change in Woodside’s growth profile is going to come from.
Woodside's North West Shelf joint venture.