Business

QCLNG on track to start commissioning within budget

APLNG project update

BG Group's QCLNG project is on track to start commissioning its Curtis Island plant in the first quarter of 2014 within budget, according to its full year results statement.

The group's fourth quarter and full year results statements were released to the London Stock Exchange on Tuesday.

The statement said the QCLNG project had delivered a key milestone with first gas transported from the Surat Basin coal gas fields onto Curtis Island, where the liquefaction terminal is located.

The milestone marked the successful completion of the 540km pipeline network, comprising the gas collection header and export pipeline.

Gas was introduced throughout the pipeline system in November and December and is now pressured up to full operating conditions.

The last of 80 construction modules for the two LNG trains and liquefaction plant's common facilities arrived from Thailand in October and was set on foundation in November.

Project construction is now in its final stages, which will allow commissioning activities to begin in the first quarter of 2014.

The statement said upstream drilling had again exceeded expectations with 205 wells in the fourth quarter. To date, more than 1900 wells have been drilled, ahead of the year-end target of 1750.

The QCLNG project remains on schedule for first LNG in the fourth quarter of 2014, and within the project's Phase 1 $20.4 billion budget.

BG Group chief executive Chris Finlayson said the company had met all of its our key milestones in 2013 and continued to progress growth projects in Australia and Brazil.

"In 2014, we will see first LNG exports from our QCLNG project in the final quarter and we will continue to ramp up production in Brazil," he said.

"Our capital expenditure will begin to decline in 2014 and we continue to expect to be free cash flow positive in 2015."

The statement said QCLNG had delivered a good safety performance during its peak construction period. 

And the production performance from the Santos Basin wells continued to exceed expectations.

In the fourth quarter, revenue and other operating income increased 14% to $5.426 billion. For the full year, revenue and other operating income increased 1% to $19.1 billion. 

Total operating profit for the full year was down 5% at $7.6 billion.

BG Group also has released a video update featuring the latest from the QCLNG project. You can view the video here.

The fourth quarter and full year results are available here.

QCLNG fourth quarter highlights:

  • Drilled more than 1900 coal seam gas wells
  • Commissioned the 92 megalitre Kenya water treatment plant
  • Six field compression stations coming online in quarter 1, 2014
  • Laid and tested 540km gas pipeline network
  • Completed Australia's longest underwater pipe pull
  • Transported gas from the Surat Basin to Curtis Island
  • Starting plant commissioning in quarter 1, 2014

APLNG project update

THE APLNG project on Curtis Island was 62% complete at the end of December.

Releasing its fourth quarter results last week, Origin Energy reported the 10th, 11th and 12th shipments of modules had been delivered to the island during the quarter.

A number of key equipment packages were delivered including the second shipment of pre-fabricated substation buildings, the boil-off gas compressors, LNG loading arms, Train 1 molecular sieve dehydrators and propane storage drums.

Items on the way included the three Train 1 cold boxes, the last two Train 2 refrigeration compressors and the final shipment of structural steel.

Construction activities during the quarter included setting the remaining Train 1 propane condenser modules on their foundations, installing the Train 1 molecular sieves, mercury removal beds and compressor substation, completing the
Train 2 compressor table tops and starting setting of the Train 2 refrigeration compressors.

After the end of the quarter, the first Train 1 methane and ethylene cold boxes were delivered and set in January.

On the first LNG tank, the outer wall concrete pour and the roof concrete pour were completed.

On the second LNG tank, the first half of the final segment concete pour of the outer wall was completed.

For the LNG jetty, deck panel installation was finished on the loading platform and concrete pours began.

All modules were placed on the jetty trestle.

Origins fourth quarter report is available here.

Topics:  bg group, curtis island, gas, gladstone, lng, qclng, resources



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