Woodside Wants Three FLNG Facilities at Browse

Australian oil and gas giant Woodside, which on Monday recommended the Browse Joint Venture to develop the Browse gas fields offshore Australia using Shell’s FLNG technology, today revealed it is considering not one, but three such vessels for the project.

Peter Coleman, Woodside CEO said:“I’m hopeful that we will receive approval from the joint venture partners shortly, allowing us to move quickly into Basis of Design phase. Given the combined size of the Browse fields the reference case is a phased development given the combined size of the Browse fields, the reference case is a phased development comprising three FLNG facilities.”

The Browse JV is looking to commercialise the three Browse gas fields Brecknock, Calliance and Torosa, located 425 km north of Broome off the Kimberley coast.

“It is clearly the best option we have to unlock the Browse resource, to the benefit of our shareholders and the broader community,” Coleman said.

He added that the final investment decision for the first phase of the project is scheduled for mid-2015.

According to news.com.au, the analysts are worried about the plan, saying that Woodside might be rushing it as the FLNG technology is yet to be tested.

Coleman said that Shell’s under-construction FLNG vessel, the Prelude FLNG, will be completed by the time the Browse JV is expecting to make the FID for its own FLNG, which “will give us cost and schedule certainty.”

Thousands of jobs lost

Woodside in April this year revealed it was not going ahead with the proposed onshore development of Browse LNG at James Price Point near Broome, saying that the development concept does not meet the company’s commercial requirements for a positive final investment decision.

The decision has been criticised by Premier of Western Australia, Colin Barnett who said that developing such a large natural resource, “which is owned by all Australians, offshore is not in the best interests of the nation or the people of WA.”

He added that the decision by the Browse joint venture was a missed opportunity for W. Australian people to secure thousands of jobs in construction and in the operation of a gas precinct.

On April 30, Woodside disclosed it entered into an agreement with Shell that sets out the key principles that would apply if the Browse resources are developed using Shell’s Floating LNG (FLNG) technology.

Shell is a pioneer in the FLNG field, but its first Floating LNG unit, the Prelude FLNG is still under construction. The keel was laid for the Prelude vessel in May this year.  The facility will, once completed be the largest offshore facility in the world, however it will probably miss out on being the first FLNG in the world. To remind, Malaysia’s Petronas expects that its FLNG PFLNG 1, being built South Korea, will start production in 2015, which will make Petronas the first company in the world to bring an FLNG facility to the market. The PFLNG1 will be deployed at the Kanowit field offshore Sarawak, Malaysia.

FLNG technology is a new gas development technology whereby natural gas from offshore gas field is processed into liquid and stored on a large vessel equipped with an LNG plant and directly offloaded to an LNG carrier for shipment. Compared to constructing a liquefaction plant onshore, it does not need to lay down gas pipelines or develop the onshore area for installing conventional facilities including liquefaction plant. Therefore, it requires less initial investments and minimizes the environmental impact. In addition, since an FLNG vessel can move to other offshore gas fields, it is a promising way of developing small- and medium-scale offshore gas fields.

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Offshore Energy Today Staff, August 21, 2013