(EnergyAsia, September 1 2015, Tuesday) — Having overshot its initial US$37 billion budget to build Australia’s largest liquefied natural gas (LNG) project, a Chevron-led consortium is also likely to miss its latest end-2015 start-up target for the same set of reasons: bad weather, labour disputes and equipment failure.
The collapse in oil and gas prices over the past 15 months has added to delays and cancellations of projects around the world.
The 15.6 million-tonnes-a-year Gorgon project was originally due to start producing LNG on a Barrow Island terminal off the coast of north-western Australia in the third quarter of 2014. Chevron, the consortium leader with a 47.3% stake, has since raised the project’s cost to US$54 billion with a new start-up target of 2016, the US major said in an investors’ briefing in early August.
Gorgon’s other shareholders are ExxonMobil (25%), Shell (25%), Osaka Gas (1.25%), Tokyo Gas (1%) and Chubu Electric Power (0.417%).
Chevron is also at risk of missing the late 2016 deadline to start up the US$29-billion Wheatstone LNG project, its other major investment also located near Onslow in western Australia. The project has been held up by delays in the delivery of vital equipment.