Crystal Energy LLC and Australia’s Woodside Petroleum announced that they have redefined their agreement governing the proposed Clearwater Port liquefied natural gas (LNG) import terminal offshore Oxnard, CA, to include “nonexclusive” discussions for LNG supply to the terminal. In its announcement on the decision, Woodside said that it is considering building its own LNG terminal offshore California.
Woodside operates Australia’s only LNG export facility and the country’s largest gas field on the North West Shelf. Woodside CEO Don Voelte said in a statement that the company is considering all options to target the rapidly growing demand for gas in the United States.
“Demand for LNG in the United States is expected to grow more than eight-fold over the next 20 years, making it one of the world’s biggest markets,” Voelte said. “Our strong reserve base in Australia and our position as an experienced producer of LNG has Woodside ideally placed to supply that market. We want to consider additional options and opportunities available to us for the export of natural gas to North America.”
The decision follows the expiration of the previous exclusive development and supply agreement between Woodside and Crystal Energy that was signed in October 2004. According to that agreement, Woodside had preferential access rights to about 80% of the Clearport terminal’s capacity and was required to provide technical expertise and funding for the terminal’s development.
Clearwater Port is still proceeding through the regulatory process at the Maritime Administration.
“Our relationship with Woodside has strengthened the Clearwater Port project, which continues to make good progress,” said Crystal Energy Chairman William O. Perkins III. He said Crystal expects to continue a relationship with Woodside which could eventually lead to a specific supply agreement. However, Crystal also is working on an LNG supply agreement with the Alaska Gasline Port Authority.
“We are also encouraged by Gov. Schwarzenegger’s recent comments concerning the best LNG project for California, in which he embraced the idea of an offshore terminal with safety standards aligned entirely with our Clearwater Port proposal,” said Perkins (see Daily GPI, June 24).
The $300 million Clearwater Port terminal would be located 13 miles offshore Oxnard, CA, on an idled oil platform, Platform Grace. The project would include a 12.6-mile pipeline to a connection with Southern California Gas Co.’s intrastate pipeline system. The terminal would have a capacity to vaporize up to 1 Bcf/d. It is expected to be in service in 2009.
“Our project’s remote location nearly 13 miles offshore provides a significant safety buffer,” said Perkins. “In addition, the use of existing infrastructure, established technologies and progressive environmental practices will minimize environmental impacts, lessen development costs, speed the time to market, and preserve precious coastal resources.”
“In the weeks and months to come, we look forward to ensuring Ventura County residents and all Californians appreciate these differentiating factors, and believe that Clearwater Port will emerge as the safest and environmentally superior option for the state,” Perkins said.
Crystal Energy is a privately-held corporation headquartered in Houston with offices in Ventura, CA, formed specifically to permit and operate Clearwater Port. Clearwater Port is among seven offshore LNG ports proposed to the Maritime Administration and is among 54 LNG import terminals that have been planned for North America. About 14 of those terminals already have received final regulatory approvals but have not yet been built, and another 24 of those planned terminals have been filed with regulatory authorities. Five LNG import terminals currently are in operation.
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