Shell takes Arrow LNG project off the table
ROYAL Dutch Shell has finally ditched plans for a new $US20 billion-plus liquefied natural gas project on Curtis Island at Gladstone, making it the latest casualty of the oil price slump.
Global chief executive Ben van Beurden said the proposed greenfield Arrow LNG project with PetroChina was "off the table", while other ventures would be slowed as priority was given to Shell's North American LNG projects.
Shell said the Arrow greenfield project was formally "cancelled", in a presentation released for its fourth-quarter results in London, which cited several ventures that were being deferred or abandoned in the wake of the collapse in oil prices.
However, the energy giant's Australian spokesman said that work was going ahead on the development of the Arrow coal seam gas reserves, which would just not be commercialised through a separate LNG project.
"Work continues on development of Arrow's substantial gas resources in the Bowen and Surat Basins," Shell Australia spokesman Paul Zennaro said.
The initial plan was for Arrow Energy, owned by Shell and PetroChina, to develop a facility on to draw extracted coal seam gas from fields in central and south-west Queensland via a pair of proposed 500km pipelines.
The proposed plant's future has been in doubt for some time, despite it securing state and federal approvals last year.
A spokesman for Shell last year 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.
Read more at the Brisbane Times.