Chevron has new partners at WheatstoneResources: 23-October-09...

Chevron has new partners at Wheatstone
Resources: 23-October-09 by Adam Orlando & Rebecca Lawson


Apache Corporation and Kuwait Foreign Petroleum Exploration Co announced that their subsidiaries are set to join Chevron to develop the Wheatstone liquefied natural gas (LNG) hub in Western Australia.

Apache and KUFPEC have signed an exclusive agreement to supply natural gas from their Julimar and Brunello fields, located in north-western Australia, to supply train one and two of the Wheatstone project.

Apache and KUFPEC will also take a 16.25 per cent and 8.75 per cent, respectively, interest in the Wheatstone project.

"We are pleased to have an opportunity to be a foundation partner with Chevron in the first LNG hub in Western Australia," Apache chairman and chief executive G. Steven Farris said yesterday.

Chevron's deal has taken away the two most likely candidates for Woodside Petroleum's expansion of its Pluto LNG project.

In a statement today, Woodside said it had been informed by Apache and KUFPEC that talks over processing gas from their fields through Pluto would be discontinued.

"Woodside remains in discussions with several third party gas owners in the Carnarvon basin over the potential processing of their gas through Pluto," the company said.

"Those discussions will continue to be based on delivering acceptable value to all parties."

Woodside added that it has started a Greater Pluto exploration drilling program this quarter, with results to "substantially contribute to an expansion of the foundation Pluto LNG project, which is 78 per cent complete".

The first phase of the Pluto project, comprising of one train, is expected to start production later next year.

The front end engineering design work is currently taking place for trains two and three of Pluto, and a final investment decision on the expansion is expected next year.

The expansion is estimated to cost $20 billion, and first gas from train two is tipped in 2013, followed by