A site, about 4.5km southwest of Onslow, northwest Western Australia, was chosen after an extensive Site Selection Study examined a number of locations in the Pilbara as part of the company’s exclusive pre-feasibility study into the development of the Scarborough gas resource, located about 280km northwest of Onslow.
The field’s location means that around $5 billion will be required to link a pipeline to shore, although the pre-feasibility study is examining a number of concepts for the field development that would connect to a single train with capacity of approximately 6 million tonnes per annum.
BHP Billiton’s Group President Energy, Philip Aiken, said the Pilbara LNG project was being considered to either supply gas to the United States west coast energy market through BHP Billiton’s proposed Cabrillo Port project, a floating LNG regasification terminal offshore from southern California, or to the growing Asian LNG markets.
Because of the competition for these markets, along with the existing NWS Venture and the proposed Gorgon Gas Development (of which it is a partner) ExxonMobil said it continues to have doubts about the project’s viability.
Currently the Western Australian Government has the Scarborough Field booked at holding 5.2 trillion cubic feet of gas (tcf) although some estimates have gone as high as 8tcf, which is considered the minimum necessary for a international LNG development.
Additionally Woodside has a $3 billion plan to bring in a fourth LNG train to service its North-West Shelf project later this year, while ChevronTexaco believes it has discovered a new gas field between the North-West Shelf fields and the yet-to-be-developed Gorgon gas field.
Aiken said BHP Billiton would continue to undertake a range of technical, commercial and marketing studies and initiate regulatory and environmental approvals from the Western Australian and Federal governments before any major financial investment decision would be made.
“We believe Scarborough is an attractive resource and Pilbara LNG presents a promising opportunity that BHP Billiton will examine, ” Aiken said.
