04/06/2009 - 00:00

Woodside, Chevron pitch gas visions

04/06/2009 - 00:00

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WOODSIDE Petroleum and Chevron have outlined rival plans for the development of gas resources off Western Australia's Pilbara coast.

WOODSIDE Petroleum and Chevron have outlined rival plans for the development of gas resources off Western Australia's Pilbara coast.

Their competing visions were presented at this week's peak petroleum industry conference in Darwin as senior executives argued the merits of their liquefied natural gas (LNG) projects.

Woodside chief executive Don Voelte, seeking extra gas for the expansion of the company's $12 billion Pluto LNG project, urged a rethink of what he called "ad hoc" developments along the coast.

Instead he argued there was scope at both the Woodside-owned Pluto project and the Woodside-managed North West Shelf venture on the Burrup Peninsula for increased capacity.

Mr Voelte said the Burrup could accommodate five more LNG trains, including two at Pluto and three at the North West Shelf venture.

"That is an 11-train vision, a truly world-class facility and arguably one that can offer the lowest unit cost of production for a significant share of the Carnarvon Basin resource," he said.

Chevron Australia managing director Roy Krzywosinski put forward an alternative vision, based on development of Chevron's Gorgon LNG project on Barrow Island and its Wheatstone project at Onslow.

He said the Wheatstone project had the potential to anchor and facilitate the economic development for not only the Wheatstone field, but other nearby gas fields.

"Bringing Wheatstone on-stream is imperative to unlocking this potential in the west Carnarvon basin," Mr Krzywosinski said.

Differing views on the best development option for the Browse gas field off the Kimberley coast added further fuel to the debate between Woodside and Chevron.

While Mr Voelte reiterated Woodside's preference for development at the proposed Kimberley gas hub at James Price Point, Mr Krzywosinski called for a thorough assessment of both the Kimberley option and the alternative of piping the gas to the Burrup so that quality development decisions were made.

The Darwin conference also heard varied opinions on the industry's supply demand outlook.

The Gorgon project, expected to get the go-ahead within the next few months, will absorb a chunk of Asian demand growth expected by 2015, said Richard Quinn, head of Australasian research for Wood Mackenzie.

Expected approvals for ExxonMobil's Papua New Guinea venture and BG Group's Queensland coal seam gas-based project may leave little scope for other ventures to go ahead in time to meet a supply window that closes off in late 2015 or 2016 when a host of other potential projects are due to start shipments, Mr Quinn said.

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