The Queensland government gas given the thumbs up for Arrow Energy’s proposed $10-billion (Aus.) Surat gas project that is expected to come on stream in 2020 to produce gas for LNG exports as well as sales gas for domestic markets.
Arrow, a joint venture of Royal Dutch Shell PLC and China’s PetroChina, is expected to bring 5 tcf (5,000 petajoules) to market during the next 27 years.
The Queensland government has granted 14 petroleum leases in southwest Queensland dedicated to the project.
In December 2017 Arrow announced a 27-year sales agreement with Queensland Curtis LNG (QCLNG), the two-train Shell-operated LNG plant on Curtis Island near Gladstone that provided a market for Arrow’s Surat gas tenements. The leases cover 2,500 sq km on blocks between Dalby and Chinchilla.
Arrow’s use of the QCLNG infrastructure, including processing facilities and pipelines, will transport the gas to market quickly and reduce the project’s environmental footprint.
Construction for the Arrow Energy project is expected to begin this year although the Shell-PetroChina JV has yet to make a final investment decision.
Arrow Chief Executive Mingyang Qian would not commit to a timeframe for the final investment decision, which is still subject to shareholder approvals, but he did say that the government’s approval for the project was a big step in that direction.
The project has now received state and federal government environmental approvals, met native title requirements, and is proceeding with binding land access compensation agreements with landholders.