Wheatstone LNG project gets environmental nod

Rick Wilkinson
OGJ Correspondent

MELBOURNE, June 17 -- Chevron Australia’s proposed $25 billion (Aus.) Wheatstone LNG project has gained conditional approval from the Western Australian Environmental Protection Authority (WAEPA).

WAEPA Chairman Paul Vogel said the project could be implemented provided stringent conditions were met to limit environmental impacts.

Vogel said assessment of Wheatstone had been complex because it involved impacts and risks to thousands of hectares of both marine and terrestrial habitat as well as significant greenhouse gas emissions.

The project includes one of Australia’s largest marine dredging programs involving the dredging of 48 million cu m during a 3-4 year period. This presented risks to tropical marine habitat, including coral reefs. In addition, an unusually high level of GHG emissions—equivalent to 10 million tonnes/year of carbon dioxide—is proposed for the Wheatstone development.

WAEPA has recommended a comprehensive set of environmental conditions be met. These include an agreed offsets package to provide a high level of confidence that WAEPS’s environmental objectives are satisfied.

Key recommendations are that Chevron offsets reservoir gas emissions consistent with the company’s Gorgon and Woodside’s Pluto LNG projects.

There also must be an ongoing requirement for independent audit of the energy efficiency and performance of the plant; strict dredging conditions to limit impacts to coral reefs and other marine animals; conditions to limit impacts on marine fauna such as cetaceans, turtles, and dugong; and offsets to manage the potential impacts to the Cane River Conservation Park, offshore islands, and local creek systems.

The WAEPA report on Wheatstone will now undergo a 2-week public appeal period which closes on June 29.

The project as proposed involves taking gas from Chevron’s wholly owned Wheatstone gas field, which straddles the boundary of offshore permits WA-17-P and WA-253-P, along with gas from the Iago field, which lies across WA-17-P and retention lease WA-16-R in which Shell has a 33.3% interest.

The plan is to take additional gas from the Julimar and Brunello gas fields owned by Apache Energy and Kufpec Australia under a deal that gives the two companies 13% and 7% equity stake respectively in the Wheatstone facilities.

The onshore facilities proposed for Ashburton North near Onslow comprise two LNG trains with a combined capacity of 8.9 million tpy, but Chevron is seeking approval for facilities with ultimate capacity of 25 million tpy of LNG. There will also be a gas plant as part of the initial phase.

First LNG shipments are timed for 2016.

The project still needs WA Government regulatory approval as well as environmental approval from the Australian Federal Government.

An interesting sidelight on the EPA’s announcement came from WA Premier Colin Barnett who said that the Ashburton North facilities would be the fifth and final major LNG precinct in Western Australia. (The others are NW Shelf, Pluto, Gorgon-Jansz, and Browse.)

Barnett said he wanted to make sure there was no overinvestment in the capacity and sites for LNG as the industry grows to maturity. He said small fields can be developed using existing infrastructure.

This statement is regarded as a clear move to direct the ExxonMobil-BHP Billiton joint venture’s moves to develop the Scarborough gas fields on the Exmouth Plateau via one of the five projects already on the table.

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