Woodside says floating LNG the future but partners undecided
But Mr Coleman said Woodside, technology provider Shell and other joint venture partners had not settled on FLNG as the way forward with Browse. This follows the scrapping of the original $45 billion-plus development plans at James Price Point last month.
"I don't want to have them feel like in any way that we're negotiating outside process," he said on Monday. "But I expect they'll come to resolution soon."
The lack of formal agreement with its joint venture partners means Woodside has not specified FLNG as the only development option as it seeks to extend its retention lease. Mr Coleman said the process was expected to be submitted within "weeks".
The rise in the original Browse development price tag has come to typify the cost blow-outs in the oil and gas sector in WA.
But Mr Coleman said Woodside now had a target cost in mind for Browse and was designing the development plan. He said another cost blow-out rendering the project unviable was not an option.
"We'll hit it with a kitchen sink," he said.
Mr Coleman rejected suggestions that investors and other joint venture partners, including BHP (which is selling its stake to PetroChina), should be wary of the unproven nature of FLNG. He said that Petronas, and ExxonMobil with BHP, had recently committed to FLNG.
Opposition energy spokesman Ian Macfarlane said floating LNG was not "optimal" given the states would miss out on "thousands of construction jobs" including career opportunities for local indigenous communities.
But Mr Coleman said the potential for a FLNG technology hub to be based in Perth outweighed the construction jobs lost.
"And they're lasting jobs because that's a skill set you can export," he said.
Frequently Asked Questions about this Article…
Woodside CEO Peter Coleman says unproven floating LNG (FLNG) technology is shaping up to be the oil and gas industry's future and, given the current high-cost environment, effectively the only viable way to develop the Browse resource — though partners have not yet formally agreed.
No. Woodside, Shell (the technology provider) and the other joint venture partners have not settled on FLNG as the way forward for Browse. Because there is no formal agreement, Woodside has not specified FLNG as the only development option while it seeks a retention lease extension.
The original James Price Point development plan, which had a price tag of more than $45 billion, was scrapped after costs rose — an example cited in the article of widespread cost blow-outs in Western Australia's oil and gas sector.
Woodside's CEO rejected suggestions investors should be wary, noting other major players such as Petronas and ExxonMobil (with BHP) have recently committed to FLNG. He also says Woodside has a target cost and is designing the Browse plan to avoid another cost blow-out.
Woodside said it expects to submit the retention lease extension process within 'weeks'. The company also expects its joint venture partners to reach a resolution on the development approach soon.
Opposition energy spokesman Ian Macfarlane warned FLNG could mean the state misses out on thousands of construction jobs and career opportunities for local Indigenous communities. Woodside counters that FLNG could create a technology hub in Perth with lasting, exportable skilled jobs.
The article names Woodside Petroleum as operator, Shell as the FLNG technology provider, and mentions other joint venture partners including BHP (noting BHP is selling its stake to PetroChina). It also references Petronas and ExxonMobil in the context of recent FLNG commitments.
No — Peter Coleman said Woodside now has a target cost in mind and is designing the development so another cost blow-out that would render the project unviable is not an option. He used the phrase 'we'll hit it with a kitchen sink' to indicate a determined approach to cost control.
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