EXPLORATION

Multiplex to Gorgon partners: Use it or lose it

According to a report in Australia's Financial Review, Multiplex boss John Roberts has been wagin...

Roberts' bid to annex the West Tryal Rocks gas field from the remainder of the Greater Gorgon reservoirs is based on a 'use it or lose it' premise, and he's prepared to build a second pipeline the length of the state to back up his vision.

In addition, he is reported to be prepared to build a subsea chrome pipeline to carry the corrosive reservoir stream to an onshore processing plant.

This is the second time in recent years Gorgon partner ExxonMobil has been accused of sitting on its undeveloped assets.

Similar pressure on ExxonMobil as the operator of several undeveloped Bass Strait gas reserves some years ago was successful in forcing the acceleration of development in the area. It also helped break the ESSO-BHP gas monopoly in the region.

It is thought the West Tryal move is part of an ambitious program by Roberts to diversify the income stream of Multiplex after succeeding in his last challenge of establishing market dominance in the British construction sector.

Multiplex is reported to have applied to the WA government for a licence to build the second pipeline as part of the effort to change the current balance of power on the region.

It is understood that last June, on the day before the leases came up for renewal, Multiplex offered to buy the West Tryal gas field for $70 million. However, the Gorgon partners declined the offer.

Roberts then took his case to the state and federal governments where it is said he argued his case "vigorously" and it seems he sowed the seeds of his proposal on some favourable ground.

He has succeeded to the extent that the retention leases, covering Australia's most valuable untapped resource, have still not been renewed for the incumbent partners.

Its been reported that Mr Robert's case is centred on a section on the 1967 Petroleum (Submerged Lands) Act, under which authorities considering an application for a five-year extension of a renewal lease must be satisfied that the lease is not commercially viable at the time the application is considered.

Mr Roberts has argued that West Tryal Rocks is indeed commercially viable, and that a renewal of the lease should thus be discouraged under the act.

"We consider it an absolute disgrace to further approve and extension to the lease, without the present leaseholders immediately agreeing to bring the field into production," Mr Roberts said.

A spokesman for Gorgon majority partner and operator, ChevronTexaco, said the US giant has spent $800 million on exploration and is busy marketing the project to Asian and North American customers in order to underwrite a $4 billion development, which would include West Tryal Rocks.

Roberts' move is sure to attract its supporters within the Australian petroleum industry who often accuse ChevronTexaco of being only interested in its big ticket assets, leaving other exploration opportunities lying waste.

Contrasts are often drawn between ChevronTexaco and the approach of another US firm with significant Australian assets, Apache Energy, which is the most active exploration company on the west coast of Australia.

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