Shell invests in world’s first floating LNG project in Australia

20 May 2011 06:41  [Source: ICIS news]

SINGAPORE (ICIS)--Energy giant Shell said on Friday it has decided to proceed with the building of the world’s first floating liquefied natural gas (FLNG) project in Australia.

The Prelude FLNG facility, to be moored some 200km (124 miles) from the nearest land in Australia, will produce gas from offshore fields and liquefy it onboard by cooling, Shell said in a statement.

The company is eyeing its upstream investment in Australia to hit some $30bn (€21bn) over the next five years, including the Prelude and Gorgon LNG projects, and ongoing exploration and feasibility studies in the country. 

Shell said it is now ready to start detailed design and construction of the facility in a shipyard in South Korea.

The FLNG plant, which Shell says will be the world's largest offshore floating facility, will be 488m (1,601ft) long and weigh around 600,000 tonnes when its storage tanks are full.

“Our innovative FLNG technology will allow us to develop offshore gas fields that otherwise would be too costly to develop,” said Malcolm Brinded, executive director for upstream international at Shell.

The new facility will be a significant boost to the LNG industry amid growing demand for the gas, which is considered to be the cleanest-burning fossil fuel, Brinded said.

“Shell has progressed the Prelude FLNG project at a rapid pace, with first production of LNG expected some 10 years after the gas was discovered,” the company said.

The FLNG facility will tap around 3 trillion cubic feet (85 billion cubic metres) equivalent of resources contained in the Prelude gas field, which Shell discovered in 2007.

Shell said that some 110,000 barrels of oil equivalent/day of expected production from Prelude should underpin at least 5.3m tonnes/year of liquids, comprising 3.6m tonnes/year of LNG, 1.3m tonnes/year of condensate and 400,000 tonnes/year of liquefied petroleum gas.

“Beyond this, our ambition is to develop more FLNG projects globally. Our design can accommodate a range of gas fields, and our strategic partnership with [engineering firms] Technip and Samsung should enable us to apply it progressively faster for future projects,” Brinded said.

($1 = €0.70)

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By: Pearl Bantillo
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