Texaco Australia Pty. Ltd. and energy utility group CMS Energy Corp., Dearborn, Mich., have joined forces to study the commercial feasibility of a second gas pipeline along the coast of Western Australia, from Onslow to Geraldton.
Estimated to cost $0.7-1 billion (Aus.), the new pipeline would parallel a portion of the existing North West Shelf Dampier-to-Bunbury gas trunkline, built in the 1980s. At Dongara, just south of Geraldton, the new pipeline would connect with the 420-km, 120 MMcfd Parmelia pipeline (formerly the West Australian Natural Gas line), which extends southward to Perth. Parmelia is owned by CMS Energy.
The new pipeline is part of a strategy to find a commercial outlet that would enable development of the Gorgon-area gas fields off Western Australia. Texaco is a major interest holder in the fields, with a 28.6% stake.
The Gorgon partners have already said they would focus on developing a market within Australia for Gorgon gas, because the prospects for establishing an LNG export project have been weakened in the past 2 years by the Asian economic crisis.
Texaco and CMS plan to conduct a 6-month feasibility study on the proposed pipeline. The idea would be to carry low-quality industrial gas to potential new markets in Western Australia. Potential users would include methanol, petrochemicals, and plastics plants that have been proposed for construction on the Burrup Peninsula. Other possible customers would include proposed steel projects in the Gladstone area.
In addition, CMS Energy is looking at establishing a natural gas-fired power generation plant somewhere between Geraldton and Perth. It would have a capacity of 500 Mw and would supply future industrial consumers, says the firm.
Texaco says that, in order to be commercially feasible, the proposed gas pipeline would need contract commitments for 279 MMcfd of gas, while the broader Gorgon project would need as much as 465 MMcfd of demand from new customers.