Approval granted for $1.6 billion North West Shelf expansion

Petroleum News Alaska

Chevron Australia Pty Ltd., a subsidiary of Chevron Corp. and a participant in the North West Shelf Venture, said April 1 that it will participate in a $1.6 billion expansion of the venture’s liquefied natural gas project near Karratha, Western Australia.

The LNG expansion project by the North West Shelf Venture will encompass three major segments:

Construction of a fourth LNG train with an annual capacity to process 4.2 million metric tonnes, equivalent to 500 million standard cubic feet a day;

Development of an 80 mile, 42-inch pipeline to shore from the venture-operated offshore gas fields;

The design and construction of the venture’s ninth LNG carrier.

Chevron said the North West Shelf Venture will invest approximately $892 million in the LNG processing and associated infrastructure expansion, with additional investments of $522 million for the pipeline and $165 million for the LNG carrier. Construction of the fourth LNG train is expected to begin in September and to be on stream by mid-2004. The Western Australia government approved the project April 1, paving the way for award of construction contracts for the LNG facility. Contracts have already been awarded to Western Australian companies for preliminary site work that began in late January. A ship tender process was recently completed for the LNG carrier that will be built in Korea by Daewoo Shipbuilding and Marine Engineering for delivery in 2004.

Chevron is the largest holder of gas reserves in Western Australia through its interests in the NWS project and its operatorship of the Greater Gorgon Area gas fields.

Participants in the North West Shelf Venture, each of whom hold equal interest, are: Woodside Energy Ltd. (operator); Chevron Australia Pty Ltd.; BHP Petroleum (North West Shelf) Pty Ltd.; BP Developments Australia Pty Ltd.; Japan Australia LNG (MIMI) Pty Ltd.; and Shell Development (Australia) Proprietary Ltd.