Last Updated : 14 September 2009 at 17:30 IST

Chevron Australia gets final nod for gas project

SHARE THIS STORY

CANBERRA (Commodity Online ) : Reassuring its efforts to develop Gorgon gas field off Australia’s northwest coast, Energy giant Chevron Monday said the gas field, once completed will be one of the world’s largest.

In a statement issued here it said Gorgon gas field will be developed off northwest Australia with export contracts already signed with China, India, Japan and South Korea.

Trading platform that even a 5 year old can trade. Join now

Chevron Australia, which owns a half share in the project and is the field operator, said in a statement that it had agreed with its partners ExxonMobil Corp. and Royal Dutch Shell to develop the gas field with a plant constructed on Barrow Island off Western Australia state.

ExxonMobil and Shell each holds a 25 percent stake.

The project appeared certain last month when PetroChina Co., Asia’s largest oil and gas company, agreed to buy 2.25 million tons of liquefied natural gas per year from the gas field in a deal worth about AU$50 billion.

Chevron and its partners last week announced further deals worth AU$70 billion to sell Gorgon gas to Japan and South Korea.

The joint venture partners decided to proceed with the project after production licenses and a development approval were granted by the state government.

Earlier, Australia’s Prime Minister Kevin Rudd described Gorgon as Australia’s biggest-ever resource development which would generate 300 billion Australian dollars ($257 billion) in export earnings.

The project was expected to boost Australia’s gross domestic product by AU$65 billion and generate AU$40 billion in government revenue over the next 30 years. It would also create 10,000 jobs during it construction phase which begins in February.

Much of the carbon dioxide emitted from the project is to be buried beneath Barrow Island to reduce its contribution on global warming.

The project’s first phase of development is estimated to cost about AU$43 billion and first work will begin immediately on Barrow Island, and the first gas is expected to be delivered in 2014.