North West Shelf news: contracts and gas sales

After a quiet couple of years in the resources sector, John Holland Pty Ltd has won a major civil works contract for the North West Shelf LNG expansion.

Under terms of the contract, John Holland will undertake all civil works and concrete foundations for the major off-plot process facilities associated with the fourth LNG Train development. This includes civil works for the sulphinol and thermal combustion units, air separation and power generation facilities.

The contract also includes the installation of all underground cabling linking the off-plot process facilities with new and existing sub-stations. John Holland will commence mobilisation of a 60-strong workforce to site in late-January 2002 and will be on site for approximately 11 months.

In gas sales news, Woodside Petroleum announced a gas sales agreement was signed between the North West Shelf Participants and Methanex Australia Pty Ltd. The NWS Venture signed a formal gas agreement to supply 200 terajoules of gas a day for more than 25 years starting in 2005.

The $1 billion Methanex plant, to be built on the Burrup Peninsula, took a big step forward after the State and Federal Governments said they would fork out $221 million in infrastructure spending. The infrastructure will include a desalination plant, access roads and an expansion of the Dampier port. The State Government will commit $136 million and the Federal Government $85 million.

For the uninitiated, Methanol is used in building materials, paints, pesticides, solvents and plastics. The world's biggest methanol plant is now only contingent on a handful of regulatory approvals and raising the project finance.

In other Woodside news, Woodside Energy Ltd said gas and condensate production has begun from the Echo-Yodel fields, three months ahead of schedule and within budget. The company said the fields would add about 37 million barrels of oil equivalent to North West Shelf Venture production over the next four to five years. They were within permit WA-28-P, about 120km north-west of Dampier in WA and 23km south-west of the Goodwyn A offshore production platform.

The Echo-Yodel development comprises two subsea production wells tied back to the Goodwyn platform with a 12-inch diameter pipeline. Production from the field will be commingled with existing production on Goodwyn and will help to compensate for the natural decline in condensate production from the much larger Goodwyn field. Hook-up, testing and commissioning began on November 16 and production began December 24.