Woodside CEO says Browse gas project on track for mid-2013 decision
BY STEPHEN BELL
PERTH -- Woodside Petroleum Chief executive Peter Coleman said that the Australian energy group remains on track to make a development decision on its Browse gas project by mid 2013. The multi billion dollar Browse project is a LNG export facility being considered on Western Australia' s north west coast. Woodside has to decide if the project is able to pipe the offshore gas to land set aside by the Western Australian government at James Price Point and build a gas processing plant along with export facilities there.
Mr. Coleman told a conference panel in Perth that Woodside is committed to processing gas at the preferred James Price Point site and is 98% through its evaluation of initial cost estimates. "We' ll make a decision as a joint venture by the end of the first half of next year," he said. Speaking to reporters after the conference, Mr. Coleman said that Woodside has recently received construction tenders for Browse. "We' ve just reviewed the first pass of them with our joint venture partners, so again I' d say we are on schedule," he said.
If the James Price Point option proves too costly, the partners may consider alternatives such as floating LNG, delaying the project, or potentially consider cheaper options such as piping the gas down to Woodside' s existing North West Shelf plant in the Pilbara region 100 km away.
Separately Shell, which partners Woodside at Browse, said that Australia needed to carry out some policy tweaks to improve productivity and limit cost rises in the gas export sector. In the meantime, cost challenged projects might need to consider floating LNG technology for some offshore gas resources or "phasing projects" which refers to staging the construction of big gas export projects to spread the cost over a longer timeframe the head of Shell in Australia, Ann Pickard, told the conference.
Shell plans to develop the world' s first large scale floating LNG plant at its Prelude field, which is due to start production in 2016. Currently in Australia, offshore gas is piped to shore and processed at land based facilities for export as LNG. Western Australian Premier Colin Barnett, meanwhile, said it is in national interest to bring Browse gas onshore to the James Price Point site as it will maximize opportunities for Australian jobs, rejecting calls from some environmental groups for the gas to feed a floating LNG plant. Green groups have urged the Browse project to use technology being developed by Shell for its separate Prelude gas field for a floating LNG plant, as they say it will cause less disruption to the picturesque Kimberley region than a land-based plant.
However, Mr. Barnett conceded the timetable for Browse may be under pressure due to shortages of skills and labor in the state. "I don' t know that Western Australia will at one time be building three LNG projects at peak construction," Mr. Barnett said.
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