Shell said it has taken a final investment decision on its Crux natural gas project offshore Western Australia to boost supplies to the giant Prelude FLNG unit.
Crux would have the capacity to supply the Prelude FLNG facility with up to 550 million standard cubic feet of gas per day (mmscfd), Shell Australia said on Monday.
Besides Shell Australia, SGH Energy, a unit of Seven Group Energy, is also part of the Crux joint venture.
Shell did not provide the price tag of the development.
Wood Mackenzie research analyst Michael Song said in a separate statement the development would cost $2.5 billion, and would produce 1.6 tcf gas, 60 mmbbl of condensate and 40 mmbbl of LPG.
“Crux has long been the leading candidate for providing new supply for Prelude FLNG. It has been a case of when rather than if the project would reach sanction, as the volumes are needed to ensure the FLNG facility produces at nameplate capacity into the 2030s,” Song said.
First gas in 2027
According to Shell, it plans to start construction on the project this year and expects first gas in 2027.
The Crux field is located in Commonwealth marine waters in the northern Browse Basin, 620 kilometers northeast of Broome.
Also, the development will consist of a platform operated remotely from Prelude FLNG.
Shell said it would initially drill five wells, and build an export pipeline to connect the platform to Prelude, located around 160 kilometers to the southwest of Crux.
Prelude FLNG has the capacity to produce 3.6 mtpa of LNG, 1.3 mtpa of condensate, and 0.4 mtpa of LPG.
In April, it shipped its first cargo since December last year after an incident forced Shell to shut the giant unit.
Meeting Asian demand
“Natural gas from Crux will play a key role in helping Asian customers move from coal to gas as a cleaner-burning fuel,” Wael Sawan, Shell’s integrated gas, renewables and energy solutions director said.
He said the project would help Shell to meet the increasing demand for LNG as the energy market transitions to a lower carbon future.
“The project will also boost our customers’ security of supply, which is becoming an ever more significant consideration for global consumers,” Sawan said.