WA to benefit from Prelude FLNG: Shell
Shell's Prelude floating liquefied natural gas project would provide a $200 million benefit to Australia if about 70 per cent of operational contracts were awarded locally, executives of the energy giant say.
The $13 billion project off the North West coast - the first of its kind and a model likely to be used by the Woodside-led Browse project - has been accused of sending jobs and business offshore.
While construction of the Prelude vessel is taking place in South Korea, Shell executives told a State parliamentary inquiry into the economic implications of FLNG that the operating phase would see the project develop local support and relationships.
Shell Australia commercial manager East Browse Ian Grose said that approach would provide more cost-effective and efficient outcomes.
He said about 200 contracts would be put in place by 2017. "We are expecting that will produce around $200 million of benefit to the local community if we get about 70 per cent local content."
Mr Grose's appearance with two colleagues at the Economics and Industry Standing Committee was one of a number of background briefings held in June but not made public until Friday.
While there had been little Australian involvement in the construction phase, he added that drilling and sub-sea installation would see local content at 37 per cent and 20 per cent, respectively.
Mr Grose said there would be about 350 people working on Prelude by 2017 and 650 indirect jobs.
About 60 Australians were already working in the operations section, he said.
Shell Australia general manager Steven Phimister said: "The floating LNG technology itself is a response, alongside other responses, to keep Australian energy competitive in the face of an increasingly competitive and difficult market in the region."
Australian Manufacturing Workers Union State secretary Steve McCartney said developing technology in Australia was critical to protecting industry.
"If we are not in the design phase and the engineering phase we do not get to that point where we break into that market," Mr McCartney told the committee.
Australian Steel Institute State manager James England said while WA might be able to squeeze about 2 per cent of the steel work for Chevron's Gorgon LNG project, which will be processing gas onshore, under FLNG there would be no steel-based local content benefit.
"In terms of design engineering with steel fabrication, all this work will go to offshore companies," he said.
