courtesy Gorgon LNG Venture

Chevron Corp.’s Australian gas field and liquefied natural gas project could cost as much as A$50 billion ($32 billion) to develop the estimated 40 trillion cubic feet of reserves in place, news agency Reuters has reported, citing a local newspaper.

Scandoil.com could not immediately confirm the report, but Chevron in Australia had confirmed in late 2008 that about A$33 billion ($21 billion) would flow to Australian industry over 30 years. Planners envision a 60-year field life.

Gorgon partners Chevron (50 percenet), ExxonMobil (25 percent) and Shell (25 percent) are seen producing an investment decision by third-quarter 2009, but commodity prices weigh heavily on project planning — as are the number of new production sites for gas seen coming on stream over the next year.

Gorgon, at some 1.13 trillion cubic metres, is about a third to a quarter the size of the world’s largest offshore gas field, Shtokman, in the Russian Barents Sea. Shtokman is seen costing $20 billion to produce in the remote High Arctic, and the extra spending at Gorgon might partly be explained by plans for carbon capture technology.

The Gorgon venture is expected to announce $300 million in supplier contracts at the investment decision announcement expected by mid-2009, when the front-end engineering runs its course.

A first $1 billion has been okayed to see Gorgon through to 2010, althouh $1 billion has already been spent on exploration, planning and early engineering . Meanwhile, tenders are now out for rock, pipe and cable suppliers. And all-told, some 50 fabricated modules weighing a total 200,000 tonnes will ship to Gorgon.

The project is set to be a “three train”, 15-million-tonnes-a-year project.

Suppliers hoping to plug into Chevron, Exxon and Shell’s Gorgon venture can apply here www.projectconnect.com.au.

Tags: Chevron Corporation