Government gives environmental nod to Arrow LNG

The proposed $20 billion (Aus.) Arrow CSG-LNG project has received long-sought-after environmental approval from the Australian government.

The news comes 3 months after the Queensland state government gave its environmental nod.

Federal Environment Minister Greg Hunt Dec. 11 approved the Curtis Island-based LNG plant near Gladstone that will be fed from coal seam gas fields in the Surat and Bowen basins. He has also separately approved the associated gas transmission pipeline.

First stage of the LNG project is aiming for production capacity of 4 million tonnes/year in 2017. This will increase to 8 million tpy of LNG in 2018 when the second train comes on stream.

Even so, there remains a cloud over the development as key project owners are Shell and PetroChina have warned that the development is not competing well with other investment opportunities.

The two majors want more value in the project. There is also a report that incoming Shell Chief Executive Officer Ben van Beurden, who takes up his role in January 2014, may consider feeding the Arrow gas through one of the other three competing LNG plants being built on Curtis Island.

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