Chevron Approves $29B Wheatstone LNG Facility in W. Australia
It's all systems go as Chevron Corp. formally approved today the $29 billion Wheatstone liquefied natural gas (LNG) project in Western Australia's Pilbara region.
The announcement likewise paved good news for job seekers as Chevron Corp. and its partners said about 6,500 direct and indirect jobs, including 3500 during construction, are expected to be made.
The facility will be constructed at Onslow, along the Pilbara coast. It includes development of offshore gas fields, a 225km pipeline, port facilities and an initial two LNG trains with a combined annual capacity of 8.9 million tonnes.
Construction of the facility will start before the year ends. About 80 percent of the initial LNG output has already been committed to Japan and South Korea.
The Wheatstone LNG facility is Australia's second largest resources project to date. Once completed, it will make Australia the world's second largest supplier of LNG, and could even catapult the country ahead of Qatar as the world's largest exporter of LNG within a decade. The project is expected to operate for at least 50 years.
Chevron Corp. said it aims to ship the first cargo of LNG to Japanese customers in 2016, adding the facility is equipped to double in size its production output to satisfy regional energy consumption growth later.
Wheatstone, along with other LNG projects, will produce a combined 45 million tonnes per annum of LNG within the next few years. It accounts for 25 percent of current world production levels. LNG produced from WA is pegged to reach more than 60 million tonnes a year by 2020.
The state and federal government expect at least $20 billion in tax revenue
The state and federal government also expect $20 billion in tax revenue and $17 billion to Australian businesses and services for the duration of the project.
The Wheatstone LNG facility is a joint venture between Chevron (73.6 per cent), Apache (13 per cent), Kuwait Foreign Petroleum Exploration Company (seven per cent) and Shell (6.4 per cent).
Global energy companies are now open to spending billions of dollars to develop reserves of natural gas off Australia's northern coast as well as trapped hoards of methane in eastern Queensland state's coal seams. Wheatstone's approval attested to that.
Wheatstone, along with other LNG projects in Australia highlights the difficulties that Western companies hurdle in getting resources in places like Iran and the Persian Gulf.
More over, buying LNG from Australia is cheaper for North Asian countries than shipping in gas supplies from the Middle East, Africa and the Caribbean.