Australia's Gorgon gas project clears important approvals hurdle

Australia's $42 billion Gorgon liquefied natural gas (LNG) project today gained another regulatory hurdle with the project partners being awarded the production licences for upstream gas fields by the government.

Chevron Corp which is the project operator says it is now awaiting development approvals from the state government of Western Australia before the parties involved can make a final investment decision. The decision is expected around mid-September.

Last week, the Australian federal environment ministry approved Chevron Corp's A$50 billion ($42 billion) liquefied natural gas (LNG) venture on Barrow Island, 50 kilometrers off the West Australian coast, adding stricter conditions on managing and protecting local fauna. (See: Chevron's $42-billion Gorgon LNG project cleared

The country's largest-ever resources project is expected to create about 6,000 jobs and is also expected to inject $33 billion in the Australian economy.

The bulk of production has already been committed to by Asian customers with project partner ExxonMobil signing the biggest Australian resources deal with PetroChina which has agreed to take up $50 billion worth of gas over 20 years.

The proposed 15-million tonnes per annum (mtpa) Gorgon project comprises three production trains and in addition a gas plant for the domestic market.