The West

Review of Wheatstone mid-project: Chevron
Wheatstone LNG project near Onslow. Picture: Chevron Australia

Chevron says it will carry out a detailed cost review of its $US29 billion Wheatstone development near Onslow when it hits the halfway mark of construction but insisted the project was on track for first LNG in late 2016.

George Kirkland, Chevron's vice chairman and head of upstream, also told investors at the weekend he was not interested in buying partner Apache's 13 per cent stake.

Apache last week confirmed it was selling out of Wheatstone as part of a refocus on its onshore US business.

"We've got all the interest we really want," Mr Kirkland said about Chevron's 64 per cent stake.

"It is at the high end of our interest that we would normally have in any operation. I typically like to be when I operate in this 40 per cent to 60 per cent range.

"We don't see any reason to have any more working interest in Wheatstone or other assets there."

Wheatstone's construction is 40 per cent complete and Mr Watson said a full review of the schedule and budget would happen at the 50 per cent stage, as was the case with Chevron's other mega project, Gorgon and "all our projects".

Gorgon has suffered two big cost blowouts, from an initial $US37 billion when the final investment decision was made in 2009, to $US54 billion. The schedule has also blown out by a year.

Mr Kirkland said Gorgon's construction was 83 per cent complete and all then modules for the first of three LNG trains bad arrived on Barrow Island.

Work on the complex jetty, which is the focus of a dispute between Chevron and contractor Leighton, is 97 per cent complete and the first LNG tank should be finished by the end of next month.

We've a target to see gas introduced into the (Gorgon) plant this year because we need the gas introduced into the plant to start commissioning activities," Mr Kirkland said.

"So one of our early activities is getting gas introduced in the plan getting the turbine generators running, get the power support for the operations.

"That utility piece is very critical to the startup and it's actually a milestone that we'll be talking about more (in three months' time)."

Mr Kirkland was also upbeat about Gorgon's ultimate ramp-up to to a three-train operation may be quicker than anticipated.

Chevron had previously flagged a six-month window between each train starting up but Mr Kirkland hinted at faster progress.

"Historically what we've said, we said we saw six months between train startups," he said.

"So I'll try to give you a little more context to what's happening on train 2 and train 3 and I think very frankly it's very good news on the train 2.

"Modules, we expect we'll have most of the modules we're trying to own on Barrow Island by the end of the year and we will even have a few we think of the train 3 modules. So the module piece of the work is going quite well, so it's moving forward very well.

"So all of that puts us in a strong position to say we're not seeing any slide on time between the startup of train 1 and train 2 and if anything, we may even see that tighten up a little bit.

"It's a little early to go there but it looks good at this point and that's a real positive."

The West Australian

Latest News From The West

Popular videos

Our Picks

Follow Us

More from The West