Shell, Barnett at odds on floating LNG
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PERTH, Nov 27 AAP
November 27 2012, 5:49PM
The debate about how to develop the Browse gas project has stepped up, with energy giant Royal Dutch Shell dismissing West Australian Premier Colin Barnett's concerns about floating LNG plants.
Project operator Woodside has for several years come under fire for proposing an onshore processing hub at James Price Point in the environmentally significant Kimberley region.
Critics of that plan, including the Australian Greens, have called for Browse Basin gas to be piped south to Woodside's existing North West Shelf facilities in the Pilbara region.
Others, including JP Morgan analysts, favour a floating liquefaction vessel, like Shell plans for its Prelude LNG project in the state's far north, but Mr Barnett says that model will not provide enough local jobs.
He was quoted on Tuesday as saying floating gas processing and storage was too environmentally risky for Browse.
"I don't think it is safe environmentally to have such a massive offshore production and storage facility for gas and oil," he said in The West Australian.
"Hopefully, it never will but accidents do happen, like the Gulf of Mexico and also Montara."
But Shell Australia chair Ann Pickard told the Deep Offshore Technology conference in Perth on Tuesday that she did not agree with Mr Barnett's comments because safety was "absolutely paramount" in the design of the vessels.
She didn't say whether she believed Browse should be a floating project.
But she said it was "an option for just about anything offshore Australia" because it was cheaper than a traditional gas project, which was becoming increasingly costly.
While Shell is widely accepted as the leader in floating LNG technology, other oil and gas companies considering such a move include Malaysia's state-owned Petronas, ConocoPhillips, France's GDF Suez and Thai-listed PTTEP.
According to a Bangkok Post report at the weekend, PTTEP has delayed a planned December re-start of the Montara field because of setbacks in attaining field permits.
The Montara spill saw an estimated 30,000 barrels of crude oil leak into WA waters over a 74-day period from August 21, 2009.
PTTEP was fined $510,000 for its actions in relation to the disaster.