Gorgon LNG Project Awarded

One of the largest natural-gas projects in the world got under way this month. Chevron Corp. and its partners, Exxon Mobil Corp. and Royal Dutch Shell Plc, are the project owners. They hold licenses to both the Gorgon gas field, located about 130 kilometers off the coast of northwest Australia in water about 200 meters deep, and the Jansz-Io gas field further north, where the water depth is 1,300 m. The fields are estimated to contain 40 trillion cu ft of natural gas and may have a lifespan of 60 years. Chevron has received environmental approval to build a three-train liquified natural-gas processing plant capable of producing 15 million metric tons per year. Barrow Island, the proposed site, is located 50 km offshore. The initial gas shipment is expected to take place in 2014. The construction workforce is expected to peak at 10,000. Chevron Australia Pty Ltd. awarded a $2.3-billion engineer, procure and construction-management contract to the Kellogg Joint Venture Group (KJVG) to handle the LNG downstream and logistics portion of the project. Government and independent experts estimate overall production costs for the project will total $40 billion.