THE go-ahead for one liquefied natural gas plant in Papua New Guinea and the possible development of a second will add to the keen demand for skilled labour and equipment in Western Australia’s booming LNG industry.
THE go-ahead for one liquefied natural gas plant in Papua New Guinea and the possible development of a second will add to the keen demand for skilled labour and equipment in Western Australia’s booming LNG industry.
The Exxon Mobil-led PNG LNG project started awarding multi-million dollar contracts last week after gaining approval from its joint venture owners.
The winners included Perth-based Clough, which teamed up with US contractor CBI to gain a $US1 billion engineering, procurement and construction (EPC) contract for a gas conditioning plant.
The biggest winners were Japan’s Chiyoda Corp and JGC Corporation, which have been contracted to build the 6.6 million tonnes per year LNG plant near Port Moresby.
Chiyoda and JGC reportedly beat US contractor Bechtel for the contract.
However, given the spate of LNG projects under development, there would appear to be no shortage of work for these companies.
Bechtel, for instance, has been contracted to undertake front-end engineering and design (FEED) work on Chevron’s planned Wheatstone LNG project, located at Onslow. Bechtel is also closely involved in coal seam gas LNG projects planned for central Queensland.
Most of the companies that won work on the PNG project are already active in the sector.
Chiyoda and JGC, along with US engineering firm KBR, are already working on the FEED for Inpex’s planned Ichthys LNG development in Darwin.
The Clough contract adds to the Perth engineering contractor’s run of success in the LNG sector.
It is part of the Kellogg joint venture, which also includes KBR, JGC and Canada’s Hatch, that is undertaking the EPC contract for Chevron’s Gorgon LNG project. That single contract has been valued at $2.7 billion, highlighting the scale of LNG projects.
The CBI Clough joint venture expects to employ about 1,200 people during peak construction of the PNG plant.
“This is a major undertaking and will require the combined resources and experience of Clough and CBI,” Clough chief executive John Smith said.
Other contracts awarded by Exxon subsidiary Esso Highlands included Saipem for construction of the offshore pipeline, French company Spiecapag for the onshore pipelines and infrastructure, and a joint venture between McConnell Dowell Constructors and Consolidated Contractors Group Offshore to provide support infrastructure.
Exxon’s partners in the PNG project, budgeted to cost $US15 billion ($A16.5 billion), include Australian companies Oil Search and Santos.
The project had been approved, pending completion of sales and purchase agreements with LNG buyers and the finalisation of finance arrangements, Esso Highlands managing director Peter Graham said in a statement.
These were expected to conclude by early 2010, he said.
The project will develop gas fields in PNG’s highlands and Western Province and transport the gas via pipeline to an LNG facility near Port Moresby for shipment overseas.
One day after the Exxon project was approved, the PNG government approved an LNG development planned by InterOil Corporation, a company that is listed on the New York Stock Exchange and has strong links to Houston but claims Cairns as its head office.
Its project targets a $US7 billion LNG facility capable of producing 8mt/year of LNG.
