Wheatstone Project, Australia

The Wheatstone project is located about 90 miles off Carnarvon Basin in Western Australia, at water depths of 650ft (200m).

The field was discovered in 2004 and is operated by Chevron. The project comes under WA-253-P and WA-17-R permit areas owned by Chevron.

Design studies for development and production, site evaluation and field appraisal work of the field were completed in 2008, as part of Chevron's wider strategy.

The company plans to process hydrocarbons from the gas fields in the two permit areas WA-253-P and WA-17-R.

The Wheatstone facility is expected to have a capacity to produce up to 25mtpa of LNG. The initial phase is expected to have a capacity of 8.6mtpa LNG, with the final investment decision to be announced in 2011.

The project will be developed in two phases. The first phase will see the construction of two LNG processing trains with a capacity of 4.3mtpa.each and a domestic gas plant.

The FEED contract for Phase I development was given to Bechtel Oil, Gas & Chemicals in August 2009.

Phase I is expected to use around 4.5 trillion cubic feet of natural gas resources located within the two permits.

Wheatstone project location

Ashburton North on the Pilbara coast of Western Australia was selected in December 2008 as the location for the LNG facility and the gas plant, based on a study of environmental and social aspects.

The site, which is 12km from the town of Onslow, is near the Lago, Brunello and Julimar fields, which are the sources of raw materials to the facility.

Offshore processing

Gas and condensate required to produce the initial 10mtpa will come from the two permit areas, and will be transferred onshore through a pipe for further processing.

The products will come through subsea wells and be transmitted via a network of subsea pipelines to the central processing platform to be located over the gas field.

The subsea system will consist of gas flowlines, manifolds and injections lines and power umbilical lines. Segregation and cleaning of gas, condensate and water will be carried out at the platform, which is yet to be developed.

The products will be dehydrated, compressed and transferred to an onshore plant through a 200km subsea trunkline.

The contract to design the subsea gas gathering facilities and pipeline was awarded to Intecsea in Dec 2009. Technip Oceania was awarded the production platform design contract during the same time. The contract includes the 200km pipeline that will link the offshore facility with the LNG plant.

Gas and LNG facilities

In March 2008, Chevron proposed to construct a domestic gas plant along with the LNG facility. The plant will have a capacity of 250 million cubic feet.

The domestic gas plant is independent of the Wheatstone project, but forms part of the development of the project. The gas plant will supply domestic gas to the local market.

Wheatstone facility contracts

The 4.1mtpa of LNG produced at the facility will be supplied to Tokyo Electric Power (TEPCO) until 2030 as per an agreement signed in December 2009.

TEPCO may also take 15% of equity share in the project field licences and 11.25% interest in Wheatstone natural gas processing facilities to be developed onshore in northwestern Australia.

Apache Julimar and KUFPEC Australia (Julimar) have been chosen as natural gas suppliers for the Wheatstone facility. Under the agreement signed in October 2009, 25% of inlet gas to train 1 and train 2 of the project will be supplied from Julimar and Brunello fields.

An equity share of 25% of the facilities will be given to the suppliers. Apache will get 16.25% of the stake and KUFPEC will hold 8.75%.

Environmental approval

The environmental approval process for the project began in September 2008. It is expected to be completed by the second quarter of 2010. The environmental scoping studies were submitted in February 2009.