Set-Back for Australia's Ichthys LNG Project

Australia's $34 billion Ichthys LNG was due for completion later this year, but the timeline has been thrown into doubt after engineering firm CIMIC involved in building the facility's power station announced its withdrawal from the project.

CIMIC has terminated its contract with JKC Australia LNG for the design, construction and commissioning of the Ichthys Combined Cycle Power Plant that will supply the Ichthys LNG export facility in Darwin with electricity. No reason for the termination was given in the company’s statement.

The power station is nearly complete, and a spokesman for Japan's Inpex, the majority owner of Ichthys LNG, said the CIMIC withdrawal is not critical.

Earlier this month, Inpex completed installation of the subsea infrastructure for the Ichthys field which is located in the Browse Basin, about 220 kilometers (140 miles) offshore Western Australia.

The project is now ready for the arrival of the central processing facility (CPF) and FPSO, currently under commissioning in South Korea. The CPF is a column-stabilized, offshore semi-submersible production unit supporting hydrocarbon processing systems and utilities, as well as living quarters for about 200 people. It will be the world’s largest semi-submersible platform and is being constructed in South Korea at the Samsung Heavy Industries shipyard.

The project’s FPSO will be used for condensate dewatering, stabilization, storage and export. The 336-meter (1,100-foot) ship-shaped, weather-vaning vessel is being constructed in Korea by Daewoo Shipbuilding and Marine Engineering. It has been designed to hold more than one million barrels of condensate.

Once all commissioning activities in the South Korean shipyards are finished, the offshore facilities will be towed to the Ichthys Field and moored for their 40 year operational life by 40,000 tons of chain secured to more than 25,000 tons of foundation piles.

The Ichthys LNG Project incorporates some of the world’s biggest and most advanced offshore facilities off the Western Australian coast, massive onshore processing facilities in the Northern Territory, and an 890 kilometer pipeline to unite them.

The Ichthys field has reserves estimates from two geological horizons of around twelve trillion cubic feet of gas and five hundred million barrels of condensate. This makes it the largest discovery of hydrocarbon liquids in Australia in more than 40 years.

When operational, the project is expected to produce 8.4 million tons of LNG and 1.6 million tons of LPG per annum, along with approximately 100,000 barrels of condensate per day at peak.