Gaunt­let down in pipe plan

Pilbara News - - News - Peter Williams The reporter trav­elled to Syd­ney cour­tesy of Wood­side Pe­tro­leum.

Wood­side Pe­tro­leum chief ex­ec­u­tive Peter Cole­man has turned up the heat on Chevron and other North West en­ergy play­ers to get the next wave of LNG projects un­der way.

He used the com­pany’s an­nual in­vestor brief­ing last Wed­nes­day to push for deals on a shared pipe­line in the Carnar­von Basin and a North West Shelf tolling agree­ment that would clear a hur­dle for the long-de­layed Browse project.

The move came as he un­veiled plans for an en­larged $US11 bil­lion ($14.5 bil­lion) Scar­bor­ough gas development in­volv­ing the con­struc­tion of a se­cond train at the Wood­side-op­er­ated Pluto LNG plant.

With­out men­tion­ing Chevron by name, Mr Cole­man said Wood­side had been in dis­cus­sions with a ma­jor re­source owner for nearly a year about op­por­tu­ni­ties in the Carnar­von Basin. “They know what they need to do,” he said. The ten­sions be­tween the two com­pa­nies sur­faced at a re­cent oil and gas con­fer­ence, when Chevron Aus­tralia manag­ing di­rec­tor Nigel Hearne pre­sented a shared trun­k­line con­cept in the re­gion where Wood­side plans to pipe Scar­bor­ough gas. “If they’re will­ing to come along and pay me some money to make a pipe­line larger and so forth, we’re very open to that,” the Wood­side boss said last week. “They’ll need to have pretty ma­ture com­mer­cial terms in place al­ready.”

He told in­vestors any deals would have to be struck by the Septem­ber quar­ter, sev­eral months be­fore Wood­side be­gan front-end en­gi­neer­ing de­sign work on Scar­bor­ough.

A map of the pro­posed trunk-line showed a route with tie-in op­por­tu­ni­ties that could in­clude West­ern Gas’ Equus project and other fields in which Chevron and Shell were among per­mit hold­ers.

Mr Cole­man has also claimed there was one hold-out among the six North West Shelf part­ners, be­lieved to be Chevron, on agree­ing to a tolling struc­ture. How­ever, it is un­der­stood ne­go­ti­a­tions are con­tin­u­ing with sev­eral par­ties.

The tolling would en­able Browse gas off the Kim­ber­ley to be piped 900km to the Kar­ratha Gas Plant. Wood­side is work­ing to a June dead­line for the deal.

Mr Cole­man warned off­shore re­source own­ers look­ing to back­fill the North West Shelf project against miss­ing out. “Bring for­ward your best of­fer. Make sure it’s ready,” he said. “At the mo­ment, Browse is a clear leader.”

Wood­side’s up­dated Scar­bor­ough plan has a cost at least $1 bil­lion more than pre­vi­ously fore­cast be­cause of a rise by two mil­lion tonnes per an­num in up­stream ca­pac­ity to 9Mtpa. A se­cond production train would be built at the Pluto plant with a ca­pac­ity of 4.5Mtpa, putting it on a par with the first train, which pro­cesses gas from the Pluto project.

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