Shell and its joint venture partner SGH Energy have given the go-ahead to develop the Crux natural gas field off Australia, which analysts Wood Mackenzie estimate will cost around $2.5bn.
The energy giant said the project would help its Asian customers transition from coal to gas, and provide secure supplies following the imposition of sanctions on Russia and concerns over supply shortages.
Construction is expected to start in 2023 with first gas expected in 2027, which will feed the Prelude floating liquefied natural gas (FLNG) facility – the largest offshore facility of its kind ever constructed.
The massive development provides 3.6m tonnes per year of LNG, and has reopened four months after safety concerns over an electrical fire.
Shell has revealed Crux site will consist of a platform operated remotely from Prelude.
Five wells will be drilled initially, and an export pipeline will connect the platform to Prelude, which is around 160km southwest of Crux.
It will have the capacity to supply the Prelude FLNG facility with up to 550m standard cubic feet of gas per day.
The decision is a boost for Prelude, which was restarted in April following a four-month hiatus, with the LNG development suffering an electrical fire last December.
Wael Sawan, Shell’s director of integrated gas, renewables and energy solutions said: “The project will also boost our customers’ security of supply, which is becoming an ever more significant consideration for global consumers,” said
“The use of Prelude’s existing infrastructure enables significantly reduced development costs, making Crux competitive and commercially attractive.”
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