Shell Ships First LNG Cargo From Prelude
Shell has sent off its first shipment of LNG from the massive Prelude floating LNG (FLNG) facility, nearly 2 years after its arrival off the northwestern Australia coast.
Prelude is expected to produce 3.6 mtpa of LNG for operator Shell, which co-owns the project with Inpex, Korea Gas, and Overseas Petroleum and Investment. It is the world’s largest FLNG facility, and the last of eight LNG plants built on Australia’s eastern and northwestern coasts during a $200-billion greenfield LNG construction boom over the past 10 years.
“Everyone involved should be very proud of the work taken to reach this important milestone,” Maarten Wetslaar, Shell’s integrated gas and new energies director, said in a statement. “Prelude forms an integral part of our global portfolio.”
While total costs of the project have never been released officially, consultancy Wood Mackenzie estimates it at approximately $17 billion. With Prelude on-stream, senior analyst Daniel Toleman said that Australia is on track to export more than 80 mtpa of LNG, surpassing Qatar as the largest LNG producer in the world.
First cargo was originally scheduled for 2018, but the project faced lengthy delays. Shell shipped its first condensate cargo from Prelude in March. The delays may affect the facility’s production plateau: Inpex’s onshore Ichthys project, which started production in October, is expected to produce 8.9 mtpa of LNG, more than double Prelude’s capacity. Toleman said Ichthys’ earlier start may have a negative impact on Prelude’s reserves.
“How fast Prelude delivers its second and third cargo, and ramps up to plateau output, will be a key indicator of success. Shell will be keen to ramp up to full production quickly to counteract any reserves impact from the already producing and connected Ichthys field,” he said.
Service Companies Show Pricing Power Growth
New analysis from Rystad Energy shows service companies are beginning to raise prices after seeing a significant drop following the oil price downturn. Pricing power is projected to keep rising in 2020 as the service industry sees more demand across the supply chain.
Anadarko Sanctions Mozambique LNG Project
The $20-billion FID is the largest ever for a sub-Saharan oil and gas project. The project’s location on the African east coast puts it in optimal position to sell LNG to the lucrative Asian market.
Inpex Inks Deal With Indonesia for Abadi LNG Project
The Japanese operator will submit a development plan to the Indonesian government within the next few weeks, with FID for the $20-billion project coming around 2022. Abadi LNG is projected to deliver 9.5 mtpa of LNG.
Don't miss out on the latest technology delivered to your email every two weeks. Sign up for the OGF newsletter. If you are not logged in, you will receive a confirmation email that you will need to click on to confirm you want to receive the newsletter.
18 June 2019
11 June 2019