Shell said the development of the world’s first ever floating LNG project is taking shape, with the company confident production will begin in 2016.
Shell is behind the $12 billion Prelude project off the West Australian coast.
Once constructed it will be the largest floating structure ever built and will be permanently moored about 200km from the coast during its 25 years of production.
Prelude is expected to produce 3.6 million tonnes per annum of LNG, as well as volumes of condensate and liquefied petroleum gas
Prelude asset manager, Jim Marshall, said the project was progressing as planned.
“The project is progressing to schedule and we are really seeing activity ramping up at locations around the world,” he said.
The project is set to bring together engineering feats from across the globe.
The sub structure of the project is being pieced together in South Korea, the turret for the project is being constructed in Dubai, while steam roller facilities were recently completed in Japan.
Closer to home, Perth based contractor Pressure Dynamics has delivered three hydraulic power units, while Shell recently awarded the construction and design contract for the Darwin onshore supply base to Western Australian Company Decimal.
Shell said Decimal have committed to Indigenous employment initiatives, and have also said they are committed to executing the contract with 100% Australian goods and services.
“The Prelude development well drilling campaign will be followed by the installation of the subsea equipment on the seven wells at the Prelude field,” the company said in a statement.
“Preparations for this critical phase of the project are underway and Prelude well heads are currently being stored at the FMC Warehouse in Henderson, south of Perth.
“The well heads will soon be trucked to Broome, before being delivered to the rig once drilling is underway.”
Shell Australia’s former chairwoman Ann Pickard has previously said the company was committed to recruiting in the local community, despite conceding it had not made “any huge difference yet
“We are still pretty new at this, but we are committed and we are turning our intentions into action,” she said.
“It’s going to be full of Australians,” she told the annual Australasian Oil & Gas Conference in Perth earlier this year.
“We have set up with Curtin University and the Challenger Institute an FLNG training program, which is going to up skill people from unique multi year program to become the first floating LNG operators.
“This will grow around the world and Australians will have an edge at being able to compete for jobs around the world on these floaters.”
Pickard told reporters the company was looking to create long-term job opportunities rather than the ‘burst’ of construction jobs.
“I think the more important things are the operation and maintenance jobs that are going to last for 20, 25 years.
“They don’t tend to put the stress on the communities that construction jobs do.
“I mean they should be the foundation, the bedrock, for our business and those jobs will exist here in Perth to support the floating industry.
Pickard said up to 85 per cent of the maintenance and operational jobs would be local.
Pickard has touted FLNG as the saviour of LNG development in Australia.
"We do see it as probably the potential saviour of the Australian LNG industry over the next decade or so."
“Australian LNG is the highest cost globally,” she said, stating that countries like the United States and Canada could export to Japan 20 per cent cheaper.