Report: Hefty repair bill in line for Chevron. Date of 2nd Gorgon LNG shipment uncertain

U.S. oil major Chevron is experiencing mechanical problems with its giant Gorgon field development in W. Australia, and according to the Australian media, the repair bill is expected to be a hefty one.

The Barrow Island-located Gorgon project, supplied from the Gorgon and Jansz-Io gas fields, started producing first LNG early in March, and sent the first shipment afterwards, on March 21, in the LNG tanker Asia Excellence.

However, according to the West Australian, the date for the second shipment from $54-billion Gorgon project is uncertain, as the company has experienced a mechanical problem at its LNG plant.

The newspaper, citing unnamed sources, claims the problem was with “ the propane refrigerant circuit” and it would take more than a $100 million to repair. The West Australian further says that this “teething problem” means the second LNG shipment is not expected to sail away before the end of April.

In an e-mail sent to Offshore Energy Today a Chevron spokesperson said: “We are working through some mechanical issues with the propane refrigerant circuit on train 1 at the Gorgon plant site. A site team is currently assessing the situation and we should know more in the coming week. The start-up of LNG train 1 and associated infrastructure on the Gorgon Project is well advanced with first LNG production reached on March 7. Upstream production from Jansz-Io is performing as expected and construction activities continue to progress well on LNG train 2 and 3.”

The Chevron-operated Gorgon project is a joint venture between the Australian subsidiaries of Chevron (47.3 percent), ExxonMobil (25 percent), Shell (25 percent), Osaka Gas (1.25 percent), Tokyo Gas (1 percent) and Chubu Electric Power (0.417 percent).

The article has been amended to include a statement by a Chevron spokesperson.

Offshore Energy Today Staff

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