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Chevron to Add Fifth LNG Train to Australian Facility for $1.5 Billion

Chevron Corp. said late last week that the North West Shelf Venture (NWSV) will be expanding its onshore liquefied natural gas (LNG) facilities near Karratha, Western Australia by adding a fifth LNG train.

The US$1.5 billion expansion project will increase the joint venture's export capacity by 4.2 million tons to 16 million tons per year. During 2004, the Train 4 LNG expansion project was completed. The additions of Train 4 and Train 5 will nearly double LNG capacity at the facility.

"Once the expansion is complete, the facility will be among the largest LNG complexes in the world," said George Kirkland, Chevron's executive vice president, upstream and gas. "Australia is an important area for Chevron, and we are pleased to play a partnership role in developing the country's natural resources. The expansion is expected to deliver many benefits to Australia and further strengthen the venture's ability to market the gas resources."

The last expansion of the facility received a green light in 2001. In April of that year (see NGI, April 9, 2001), Chevron received regulatory approval by the government in Western Australia to allow Chevron Australia Pty Ltd. to move forward with a $1.6 billion expansion of its Australian LNG facilities. That expansion involved three major projects: construction of a fourth LNG train with an annual capacity to process 500 MMcf/d; development of an 80-mile, 42-inch diameter pipeline to shore from the NWSV-operated offshore gas fields; and the design and construction of the venture's ninth LNG carrier ship. That expansion, which was designed mainly to increase exports to Japan and Pacific Rim countries, also provided increased LNG shipments to the United States.

Chevron reported that work on the fifth LNG train will begin with site development work next month, with the construction work force expected to peak at 1,500 people by mid-2007. Commissioning is planned to occur mid-2008.

The company said it holds a one-sixth interest in the joint venture. In addition to Chevron's subsidiary, ChevronTexaco Australia Pty Ltd., the other North West Shelf venture participants also hold a one-sixth interest are: BHP Billiton Petroleum (North West Shelf) Pty Ltd., BP Developments Australia Pty Ltd., Japan Australia LNG (MIMI) Pty Ltd., Shell Development (Australia) Proprietary Ltd., and Woodside Energy Ltd. (operator).

Chevron pointed out that CNOOC NWS Private Ltd. is also a member of the North West Shelf venture but does not have an interest in the North West Shelf venture infrastructure.

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