The West

Chevron has for the first time spelt out which of its myriad gas field discoveries in the Carnarvon Basin are earmarked to feed a fourth Gorgon LNG train.

Chevron also used a visit by a group of the US giant's investors to Barrow Island, the site of the $43 billion Gorgon's onshore operations, to affirm its confidence that the three-train foundation project would be ready for first production by late 2014.

However, Chevron stopped short of declaring the project budget to be on track, repeating its warning from earlier this year that a "cost and schedule review is under way" principally because of foreign exchange rate movements and "weather, logistics and labour productivity" headwinds.

Analysts expect Chevron, the operator and 47.3 per cent partner in Gorgon (ExxonMobil and Royal Dutch Shell have 25 per cent each, with Japanese customers the remainder), to confirm a cost blowout early next year, and maybe even delay the first-gas schedule.

In the meantime, Chevron is pushing ahead with plans for a fourth train at Gorgon - the three foundation processing lines will have a combined LNG output capacity of 15.6mtpa - and yesterday told investors that front end engineering and design work would begin late this year.

Chevron is targeting an 11 trillion cubic feet resource to feed Gorgon's fourth 5.2mtpa train, starting with the Chandon and Geryon fields. The Gorgon expansion will require a new trunkline and an extra LNG tank on Barrow Island.

Chevron has long talked about a Gorgon expansion and has enjoyed a successful exploration campaign in the Carnarvon Basin, without disclosing which of the new finds would feed the fourth train.

The West Australian

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