The Chevron-led owners of the Gorgon liquefied natural gas project in Australia have made a final investment decision for a phase two upstream development, writes Russell Searancke.

Phase two is centred on maintaining gas supplies from the deep-water Gorgon and Jansz-Io fields into the three-train Gorgon LNG plant on Barrow Island.

Chevron Australia managing director Nigel Hearne said Gorgon stage two is part of the original development plan for Gorgon.

“Benefits are expected to flow through to Australian industry, arising from local project management, drilling and completion activities and subsea infrastructure installation,” said Hearne.

It is understood that Baker Hughes (through GE Oil & Gas) has been awarded a subsea equipment contract for phase two, but the second substantial turnkey contract has not been finalised yet.

GE provided the huge subsea production system for the initial Gorgon project.

Six major subsea players have been competing for an offshore installation contract — Allseas, Hereema Marine Contractors, McDermott, Saipem, Subsea7 and Technip — however, sources said some of these have withdrawn from the competition.

Stage two will expand the subsea gathering network in both fields, and this will also involve a new drilling campaign, as well as the installation of new subsea manifolds to accommodate new wells, and flowlines to tie into the existing subsea equipment.

The workscope is understood to include the installation of 18-inch and 24-inch flowlines and buckle initiators including pipeline end termination structures, six-inch and eight-inch monoethylene glycol pipelines and six-inch utility pipelines.

Several other structures and tie-ins are required in water depths between 250 metres and 1338 metres.

Umbilical installation will be needed, as well as pre-commissioning comprising flood, gauge and pressure testing of the pipelines. Pressure testing of the spools and jumpers will also be required, as well as flowline dewatering and conditioning in readiness for start-up, and control system continuity and function testing.

It is understood that output from the new wells and subsea facilities will be channelled through the main production pipelines at Gorgon and Jansz-I.

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Gorgon phase two approval