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LNG projects gathering steam Tentative deals to import from Australia; ExxonMobil weighs site purchases Gary Park Petroleum News Calgary Correspondent
Momentum keeps building among the largest liquefied natural gas proponents, who have unveiled a series of deals and tentative projects this month.
ChevronTexaco and Shell Gas & Power announced the initial stages of two ventures to ship LNG to the West Coast of North America from the huge Gorgon gas field offshore Western Australia, while ExxonMobil has taken the next step to lock up terminal sites in Texas and Alabama.
ChevronTexaco said it has a tentative deal to buy at least 2 million metric tons a year from Gorgon under a 20-year contract to start in 2008.
Shell followed that with a letter of intent for identical volumes over the same period, other than a scheduled 2007 start-up to serve utilities, industrial users and power plants in northwest Mexico and southern California.
Partners in the Gorgon joint venture are ChevronTexaco with a 57.14 percent stake, Shell with 28.57 percent and ExxonMobil with 14.29 percent. Baja California anchor proposal Both contracts are anchored on a proposed import and regasification terminal offshore Baja California, Mexico, although ChevronTexaco is also weighing the viability of LNG terminals at U.S. West Coast and Gulf Coast locations.
Mexican environmental authorities have already issued approval for construction of a facility at the Costa Azul site.
The greater Gorgon region has estimated total natural gas resources of more than 40 trillion cubic feet, or one-quarter of Australia’s known reserves, with the joint venture field’s proven reserves placed at 12.9 tcf. Development of the field is forecast to cost $7.2 billion over the next 20 years.
Meanwhile, ExxonMobil has signed a purchase option for an LNG terminal site at Corpus Christi, Texas, and is evaluating a similar option for Mobile Bay, Ala., but has declined to indicate whether it is thinking of terminals at both locations.
The Alabama State Port Authority has indicated that the Mobile Bay facility could have initial throughput capacity of 1 billion cubic feet per day at a cost of $600 million.
But the authority has yet to decide whether to offer the former U.S. Navy home port to ExxonMobil.
Cheniere Energy has announced plans for an LNG terminal of 1.5 bcf per day for the Corpus Christi site and formed a partnership in June with BPU LNG, an affiliate of Sherwin Alumina.
ExxonMobil is also exploring possible LNG terminal sites at Beaumont, Texas and Sabine Pass, La. Cheniere plans to build a terminal at Sabine Pass, in addition to its largest project at Freeport, Texas, and a fourth scheme in Brownsville, Texas.
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