BG Group takes official control of Queensland LNG plant

Nov 25, 2015


BG's QCLNG venture shipped its first cargo from Gladstone in early January.

BG’s QCLNG venture shipped its first cargo from Gladstone in early January. Photo: Supplied

BG Group has taken over the keys for its $US20.4 billion Queensland Curtis liquefied natural gas project, formally declaring the start of commercial operations at the second production unit at the monster plant in Gladstone.

The UK gas major, due shortly to be taken over by Shell for about $US70 billion, advised late Wednesday it had taken control of the second train from Bechtel, the private US-based engineering firm that is building all three LNG export plants at Curtis Island in Gladstone harbour. It started exports from the first train in January and has now shipped 71 cargoes.

The news comes as Queensland’s third LNG export venture, Origin Energy’s $25 billion Australia Pacific LNG project, should be commencing production within days. Origin said October 30 that it expected to start producing at the plant “within a month”. Santos’s $US18.5 billion GLNG venture started up in September and shipped its first cargo the following month.

The run of start-ups at the three Queensland plants, which together will almost double Australia’s existing LNG export capacity, has contributed to an oversupply of gas in the Asian export market, where prices are already under pressure due to low crude oil prices. In contrast, local gas buyers in the eastern states have been complaining of hefty price increases when they seek to sign new long-term contracts as some gas is directed instead to the export projects.

BG chief executive Helge Lund thanked the partners, contractors, government authorities and local communities and landholders affected by the QCLNG project. which is supplied by gas extracted from coal seams in the Surat Basin. The project was the first gas export venture worldwide to be fed by coal seam gas.

“They all helped us to not only connect QCLNG to more wells than any liquefaction plant in the world, but establish a new LNG industry based on natural gas in coal seams,” Mr Lund said.

“With both trains now fully operational, QCLNG adds significant volumes and flexibility to our LNG shipping and marketing portfolio.” Bechtel’s general manager LNG, Alasdair Cathcart, said that more than seven years of planning, construction and commissioning work “have led us to this moment” when the plant is formally handed over to BG.

BG and Chinese oil giant CNOOC each own 50 per cent of the first train at QCLNG, while the second train is owned 97.5 per cent by the UK company and 2.5 per cent by Tokyo Gas.

Once the second train reaches full production by mid-2016, the project is expected to be shipping about 10 cargoes a month,equivalent to about 8 million tonnes a year of LNG.

by: Angela Macdonald-Smith, Energy Reporter

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About artidj

I started working as a field engineer in Oil & Gas industry back in 1996. I do this news clipping of the industry and the geography I am interested in, mainly for my own information. I'm glad you find it useful.
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