Shell keeping quiet about $15 billion gas plant

SHELL is still keeping quiet about the future of a $15 billion gas plant proposed off Gladstone, even as industry experts describe the massive processing factory as a "key uncertainty" for Australia's gas sector.

It comes as the federally funded Bureau of Resources and Energy Economics released its latest report, including its forecast for the emerging gas sector.

BREE estimates Australia's east coast will triple the amount of gas it is producing by mid-2019 thanks to three giant gas conversion operations being developed on Curtis Island.

In the 2012-13 financial year, the eastern market produced 22 billion cubic metres of gas.

Six years on, BREE expects that to top 61 billion cubic metres.

The Australia Pacific LNG, Gladstone LNG and Queensland Curtis LNG projects - with a combined value of more than $60 billion - intend to do the same thing as Arrow: convert CSG into liquefied natural gas for export.

The initial plan was for Arrow Energy, owned by Shell and PetroChina, to develop the huge facility on to draw extracted coal seam gas from fields in both central and south-west Queensland via a pair of proposed 500km pipelines.

According to BREE, its future remains in doubt despite winning state and federal approvals last year.

"The company has been cautious in recent months about the prospects of developing their own LNG plant to draw on those resources," the report stated.

"Arrow currently produces around a billion cubic metres of gas a year for domestic use but may consider selling into existing LNG projects in the future rather than developing their own LNG facilities".

A spokesman for Shell would not discuss the company's position on selling gas to its Curtis Island counterparts in lieu of the major project.

He said the company was "looking for more value in the project" and would consider collaboration if it meant a better deal for shareholders.



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