Australia’s three sanctioned Gladstone CBM-to-LNG projects could face a gas squeeze – rather than glut – when they come online in the next few years, as a result of the delays caused by severe flooding in Queensland, Origin Energy’s Managing Director Grant King told Interfax.
“We will enter another paradigm where, in aggregate, not only will the industry be able to manage the ramp-up, but probably it is going to be a bit challenged to deliver the aggregate resource,” said King. “While all three LNG projects under construction in Gladstone are on track, the huge effort needed to get all of the onshore gas wells up and going has been affected by flooding in Queensland over the past two years.”
The flooding in Queensland caused about A$1 billion ($1 billion) worth of damages in December 2010 and January 2011, when thousands of residents were evacuated from their homes. Heavy rain forced more widespread evacuations in February this year.
The Australia Pacific LNG (APLNG) project that Origin is developing with ConocoPhillips and Sinopec has the largest CBM reserves among the three Gladstone LNG projects, with 12,810 petajoules (344 billion cubic metres) of proven and probable reserves and 430.2 bcm of proven, probable and possible reserves as of the end of 2011.
The companies plan to drill more than 10,000 wells over APLNG’s lifetime, compared with around 2,650 for the Santos-led Gladstone LNG (GLNG) project and approximately 6,000 for BG Group’s Queensland Curtis LNG (QCLNG).
Natural Gas Review
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