Australia’s Tox Free says Chevron ends Gorgon contract

Australian waste management company Tox Free Solutions said Tuesday its contract with Chevron for the giant Gorgon liquefied natural gas (LNG) project on Barrow Island would cease at the end of June.

Toxfree initially signed a $170 million five-year deal back in 2013 to provide waste management services for Chevron Australia’s assets in Western Australia. Under that deal, the Gorgon contract was expected to last until June 2018.

“Toxfree believes we put forward a very strong proposal to retain the services on Barrow Island while ensuring an adequate return on investment for Toxfree shareholders,” it said in a statement.

The company expected to generate about $1-2 million from the contract’s final year.

Toxfree said it would continue to provide services to Chevron’s other Australian operations under its master contractor services contract.

Toxfree’s contract for industrial services on the Wheatstone LNG project with Bechtel will also not be affected by Chevron’s decision.

The waste management company noted in its statement that it has recently secured contracts for the Inpex-led Ichthys LNG project in Darwin and Santos GLNG in the Surat Basin.

“We are confident these contracts will result in improved earnings in FY18 regardless of the Chevron decision,” Toxfree said.