Last month, Chevron, which owns almost 50% of Gorgon, was among 10 USA oil companies whose credit ratings were cut by Standard & Poor’s due to the oil-price rout.
Chevron is also behind Australia’s 8.9 mta Wheatstone LNG project, whose costs have soared from US$23 billion to an estimated US$33 billion, according to analysts Macquarie.
“We congratulate the Gorgon workforce on this achievement…”
Chevron Corp. (NYSE: CVX) started producing LNG and condensate at the Gorgon Project on Barrow Island off the northwest coast of Western Australia, and the first LNG cargo is scheduled to ship next week, the company said March 7. Another of Gorgon’s big investors- Exxon Mobil Corp.-had its triple-A corporate rating placed on watch by S&P for a possible downgrade. “This is the result of the collaboration of hundreds of suppliers and contractors and many tens of thousands of people across the world during the project design and construction phases”, Watson continued. Osaka Gas, Tokyo Gas and Chubu Electric Power each have minor interests.
The project is a cornerstone in Chevron’s efforts to become a major LNG supplier over the next four years, with Gorgon and a neighboring development in Western Australia known as Wheatstone targeting growing demand for natural gas in the Asia-Pacific region.
Gas sales from LNG projects in the Asia-Pacific region such as Gorgon are linked to swings in oil prices, meaning returns on investment are more vulnerable to volatility in commodity markets than export-oriented facilities in the U.S. In 2015, LNG prices in Asia roughly halved.
Gorgon is the largest single-resource development in Australia’s history, and has cost around $54 billion to build. It is built on a Class-A Nature Reserve.
Construction started on the project in 2009.
“But the long-term benefits will be even greater”.
The first official cargo of LNG from Gorgon is expected next week.
The project, which is starting up more than a year late and more than $12 billion over budget, together with other new LNG projects starting production in the 2014-17 period, should ensure Australia overtakes Qatar as the world’s biggest exporter of the fuel by the end of the decade. Off-topic, inappropriate or insulting comments will be removed.