12/09/2006 - 22:00

Big boost in project planning

12/09/2006 - 22:00

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The Gorgon LNG project has provided a $1 billion boost to the Western Australian economy, and it hasn’t even started yet.

Big boost in project planning

The Gorgon LNG project has provided a $1 billion boost to the Western Australian economy, and it hasn’t even started yet.

Gorgon provides a compelling example of the massive economic boost during the planning phase of big resource projects.

If Chevron were to scrap the project tomorrow – and nobody is suggesting that would happen – Gorgon would have generated hundreds of jobs for staff and contractors over the past decade.

Chevron estimates that more than $1 billion has been invested in exploring, marketing and developing Gorgon’s gas resources.

Most of this would have been spent on drilling; in the past year, $125 million has been spent on exploration in the Gorgon area.

The engineering industry has received a big boost, with $100 million spent on the front-end engineering and design phase.

This has gone to firms such as Kellogg Brown & Root, Clough, Technip and JP Kenny.

While some of the engineering design work has been undertake in Houston, two-thirds of the people working on the FEED phase have been based in Perth.

Gorgon has also provided a huge boost to the environmental consulting industry, which is ironic given the opposition to the project by environmental activists.

More than 100 environmental specialists from 30 different organisations have worked on Gorgon, contributing to the project’s 3,500-page environmental review. Gorgon has also lifted knowledge of subsea technology and greenhouse gas management.

The engineering industry has been one of the biggest winners from the overall project boom.

Firms such as WorleyParsons, Sinclair Knight Merz, Fluor, Calibre Projects, Hatch and GRD Minproc are operating at record levels in WA.

The amount of money involved is illustrated by two big projects.

WorleyParsons has signed a $160 million reimbursable contract to manage Fortescue Metals Group’s Pilbara iron ore and infrastructure project.

And WorleyParsons, along with UK firm Foster Wheeler, and Kellogg Brown & Root, will earn $192 million from front-end engineering and design work on Woodside’s Pluto LNG project.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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