FEBRUARY: First shipment of Darwin LNG
THE first liquefied natural gas shipment from Darwin marked the start of production from Australia’s second LNG export project, 17 years after the North West Shelf started exporting to Japan.
Completed on budget and one month early, the $A2 billion Darwin LNG project is the second phase of development for the Bayu Undan gas fields in the Timor Sea, about 500km northwest of Darwin.
Darwin LNG has contracts to supply Tokyo Electric and Tokyo Gas with about 3 million tonnes (MMt) of LNG per year for 17 years.
The Wickham Point site has approval to produce 10MMt of LNG per year. The partners are currently pursuing new gas supplies for an expansion.
Darwin LNG's main shareholders are ConocoPhillips, Santos, Eni, Inpex, and Tokyo Timor Sea Resources.
MAY: NWSV sends first LNG to China
THE North West Shelf Venture sent its first LNG shipment to China under a 25-year, $25 billion contract with CNOOC, China’s largest offshore oil producer by output.
The shipment was received at the Guangdong Dapeng LNG Terminal.
Signed in 2002, the contract will see 3.3MMt of LNG, or 50 shipments, delivered each year to the newly constructed terminal. The deal represents the NWS Venture’s largest single export contract to date.
JUNE: Darwin to accelerate LNG evolution
DARWIN LNG operator ConocoPhillips said it might spend up to $10 billion to almost treble capacity at its Northern Territory LNG plant to meet booming global demand.
The company could build a second production train at the facility by 2013 using gas from the Greater Sunrise fields or the Caldita discovery in conjunction with other as yet undiscovered fields in the Timor Sea/Bonaparte basin region.
The company said it might also consider a third train. The facility’s current capacity is 3.5MMt per annum, but it has approval for as much as 10MMtpa and the second train could be almost twice the size of the first train. If so, further trains would need regulatory approval.
JULY: Chandon discovery: bigger than Pluto?
CHEVRON had yet to release a resource size estimate for its Chandon-1 gas discovery in WA-268-P, but outside observers had speculated it could be in the order of 4 trillion cubic feet (Tcf).
This meant the find, which is close to the giant Jansz field and could be tied back to the Gorgon project, could even be bigger than Woodside Petroleum’s 3.5Tcf Pluto discovery.
While Chevron owns 100% of the Chandon permit, under an agreement signed in 2005 covering Gorgon, Exxon and Shell would each take 25% of the discovery.
In addition to the size, Chevron also failed to divulge the gas quality – or carbon dioxide content – of the discovery.
Gorgon gas tends to have high CO2 levels, which is reason the venture is examining the expensive option of geosequestration at Barrow Island.
Santos discovers gas at Evans Shoal wildcat
SANTOS said it was hopeful that its Evans Shoal South gas discovery in the Timor Sea would underpin construction of a second LNG train at Darwin.
The Darwin LNG offshore facility, operated by ConocoPhillips, produces more than 100,000 barrels of liquids a day and sends gas through a 502km undersea pipeline to the Darwin LNG plant.
Further technical assessment needs to be undertaken to determine the significance of the Evans Shoal South discovery, as drilling and sampling difficulties meant the company was unable to obtain definitive data.
The well reached a total depth of 4097m and encountered hydrocarbons in the primary and secondary zones of interest. No hydrocarbons were brought to the surface.
“The well was not drilled to the planned total depth of 4225m due to poor hole conditions, and has now been plugged and abandoned as programmed,” Santos said.
October: Woodside rockets to Pluto
WOODSIDE won approval to develop Pluto without having to immediately set aside up to 15% of gas for use in the Western Australian domestic market.
Woodside will be given at least five years to determine whether supplying gas from the Pluto field for the WA market is viable. The decision would be assessed by an independent arbitrator.
But the day before this decision was released, the NWS Venture partners were believed to have rejected Woodside’s proposal to process gas from the Pluto reservoir through facilities at the existing Burrup Peninsula gas processing site.
This veto could cost Woodside hundreds of millions of dollars, threatening a project that the company says is already endangered by the WA Government’s gas reservations policy.
NOVEMBER: Major gas discovery at Greater Gorgon
GORGON operator Chevron announced its second major gas discovery in the space of a few months – and this one could be low in CO2.
The Clio-1 exploration well was completed in September, after finding 190m of new gas sands in the Mungaroo Formation, making it “one of the top wells in Australia in terms of total net gas pay”, according to Chevron.
The WA-205-P discovery, which is also low in CO2, follows Chevron’s Chandon-1 gas find in nearby WA-268-P in July.
Chevron had said it planned to start a seismic survey to better define the discovery and options for how to develop the field.
DECEMBER: PNG LNG by 2011?
INTEROIL announced ambitious plans to deliver LNG from a first train in 2011 at its Elk gas discovery in Papua New Guinea, with a second train coming onstream a year later at a project cost of up to $US6 billion.
Construction and development of an LNG industry would include refrigerated ships and a large processing facility, most likely near Port Moresby, with product to be shipped to markets in the north of Asia and western states of North America.
The PNG Government has declared Elk-1 hosts gas and condensate at high pressure, with gas reserves close enough to the coast for development estimated at several trillion cubic feet.
The Government’s endorsement of the Elk-1 discovery came as it appeared increasingly unlikely that the much-anticipated PNG gas pipeline project would come to fruition.
Green light for Gorgon
WA ENVIRONMENT Minister Mark McGowan cleared the way for environmental approvals to be given to the $15 billion Gorgon LNG project.
But McGowan also provided a framework for environmental conditions, one of which involves spending $60 million on protecting Barrow Island’s flatback turtle population
The conditions, as well as environmental approval from the federal minister, will need to be finalised before the project can proceed.
