Chevron announced that $US34 billion Australian Wheatstone LNG project has shipped its first LNG cargo to one of the project’s foundation buyers, JERA (Chubu Electric, TEPCO JV, the biggest LNG buyer in the world). The cargo is being delivered by the Chevron-owned 160,000-CM Asia Venture LNG carrier.
Australia’s massive expansion in LNG production has propelled it past Malaysia to become the world’s second-biggest exporter of the super-chilled fuel, Reuters reported, adding that once all the nation’s mega-projects are completed, Australia will be the world’s largest LNG exporter.
The LNG market will be focused on how smoothly Wheatstone progresses following the troubled start-up at Chevron’s Gorgon LNG project. “At full capacity, the Wheatstone project’s two train LNG facility is expected to contribute around six percent of the Asia Pacific region’s total future LNG production, delivering 8.9 MMT/Y of LNG for export to customers in Asia,” Chevron remarked.
Wheatstone LNG project’s second train is expected to commence output in six months to eight months' time. It will also produce 200 terajoules per day of domestic gas for the WA market.
Meanwhile, S&P Global Platts has reckoned that Australian LNG exporters will face increased volatility as decade-old contracting methods change to short-term flexible models as it has found the nation's LNG sector will continue its expansion to become the biggest exporter on the globe, but that significant change is needed to take advantage of an evolving gas market.
"The increasingly buyer-friendly characteristics of global LNG trading is adding further challenges to an exporter that has structured its business model around primarily destination-restricted, oil-indexed long-term contracts," the S&P Global reported. "The traditional ways of doing business, based on destination-restricted, oil-indexed long-term contracts, are disappearing, making room for enhanced flexibility and interconnectivity."

 

Wheatstone LNG
Past	Present

Backgrounds:

On 9-Oct-2017, Chevron announced that it has started producing LNG at the Wheatstone project in Western Australia as the first cargo is on track to be shipped in the coming weeks. “Wheatstone adds to our legacy gas position in Australia that will be a significant cash generator for decades to come,” said Chevron CEO John Watson.
The LNG facility is located 12-Km west of Onslow and processes natural gas from the Chevron-operated Wheatstone and Iago fields.
The Chevron-operated Wheatstone LNG facility’s shareholders are Chevron (64.14%), Kuwait Foreign Petroleum Exploration Company (KUFPEC) (13.4%), Woodside Petroleum (13%), and Kyushu Electric (1.46%), PE Wheatstone (8%). Chevron holds an 80.2% interest in the offshore licenses containing the Wheatstone and Iago fields.

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