By OGJ editors
HOUSTON, Aug. 6 -- A unit of ChevronTexaco Corp. Tuesday said it signed a memorandum of understanding with the joint venture partners of Gorgon natural gas field off Western Australia to supply at least 2 million tonnes/year of LNG over 20 years starting in 2008 to an LNG terminal planned for construction off Baja California.
Other detailed terms of the MOU were not released.
Gorgon field has proven reserves of 12.9 tcf of gas with total gas resources in the Greater Gorgon area exceeding 40 tcf, said ChevronTexaco. The Gorgon JV participants include operator ChevronTexaco (4/7th interest), Royal Dutch/Shell Group (2/7th interest), and ExxonMobil Corp. (1/7th interest).
"Growing North American demand for natural gas is widely projected to outstrip supply capabilities," said John Gass, president of ChevronTexaco Global Gas, which coordinates the company's worldwide gas businesses.
ChevronTexaco currently is seeking approvals from "local Mexican authorities" to permit the construction and operation of an LNG terminal and regasification facility off Baja California, which would be capable of receiving Gorgon LNG, a spokeswoman from ChevronTexaco told OGJ. "We believe the world-class Gorgon gas field and the significant natural gas resources in the Greater Gorgon area are ideally situated to meet growing demand in the Asia Pacific basin," said Gass said. "Development of these resources is a key element of our strategy to commercialize our equity resource base by targeting North American and Asian markets."
Although a specific site for its LNG terminal has not been revealed, ChevronTexaco said it is aiming to "secure a site by the fourth quarter of this year," the spokeswoman said.
Shell's LNG terminal
Separately, Shell Gas & Power, a unit of Shell, is currently proposing to build a new, 7.5 million tonne/year LNG import terminal in Costa Azul, 23 km north of Ensenada on the west coast of Mexico. This terminal will compete with ChevronTexaco's proposed terminal.
Shell said that it expects to begin operations of the new terminal in 2007. "Terminal permitting activities with the Mexican authorities are well advanced," Shell said.
Shell plans to market the LNG to power plants, industrial customers, and utilities in northwest Mexico and in southern California, it said.
