Chevron likely to ship first Gorgon LNG in 2016

August 4, 2015

Oil and gas giant Chevron will likely miss its year-end target to ship the first LNG cargo from its USD 54 billion Gorgon project on Barrow Island in Western Australia.

“The schedule is dependent on managing commissioning and start-up risks including equipment malfunctions, possible labor and weather disruptions, as well as other unforeseen issues,” Jay Johnson, Chevron’s executive vice-president upstream told investors on Friday.

“We are working to achieve the first LNG cargo by year end; however, given these risks, it’s likely to occur in early 2016,” Johnson added.

The start-up of the Gorgon project was pushed back several times. The giant LNG project was originally budgeted at $36.7 billion and was expected to start producing the chilled gas at the end of the third quarter of 2014.

Gorgon construction update

According to Johnson, construction works on the 15.6 mtpa LNG plant located on Barrow Island are in advanced stages.

“We are nearing mechanical completion of the first LNG train with over 60% of critical subsystems handed over to commissioning,” Johnson said.

All LNG and condensate tanks required for first LNG are ready and commissioning of completed process systems is underway, according to Johnson.

Currently, the critical path is through the refrigerant compressors and the hydrate prevention system for the subsea wells.

“We expect to perform the first commissioning run of the compressors and testing of the hydrate prevention system in late September.

“Once we are satisfied with the operation of these systems we will be ready to introduce gas in the Jansz wells into the upstream pipeline and begin the start up of Train 1, which we currently expect late this year,” he added.

Overall, the Gorgon LNG project, including the upstream and the downstream scope, is more than 90 percent complete.