Another cost blowout for Gorgon project

gorgonCOSTS have ballooned again at the massive Chevron-operated Gorgon LNG project, now estimated at US$54 billion.
The company has had a number of cost blowouts during the course of the project’s construction, estimating in 2009 it would cost US$37 billion and then revising it to US$52 billion in 2012.
First gas and plant start-up from Gorgon is estimated to start in mid-2015, which was originally planned to begin by the start of 2014.
The Gorgon project will develop the Gorgon and Jansz-Io gas fields in the Greater Gorgon area offshore the northwest coast of WA.
Once complete it will comprise a 15.6 million tonne per annum LNG plant on Barrow Island and a domestic gas plant capable of supplying 300 terajoules of gas per day to WA.
The project has been under construction for four years and is nearly 75 per cent complete, according to Chevron. Despite the cost blowout the economics were attractive, Chevron vice chairman George Kirkland said.
“Approximately 75 per cent of our combined LNG offtake from the two projects (Wheatstone and Gorgon) is committed under firm, long-term sales and purchase agreements,” Mr Kirkland said.
“These LNG developments are two of our most important future legacy assets.”