BG Group commits $15b to Australian LNG project

08:54, November 02, 2010      

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British gas firm BG Group announced Sunday that it will spend $15 billion on a liquefied natural gas (LNG) project in Australia, and Canberra hailed the investment for its expected boost to the national economy.

The investment will expand existing coal seam gas production in Queensland state and go toward the construction of a 540-kilometer underground pipeline linking gas fields to a pioneering new LNG plant.

BG Group, which is one of several companies seeking to convert Queensland's rich coal seam gas deposits into LNG for export to meet surging Asian demand, made the final investment decision after receiving environmental approval October 22.

The firm's chief executive, Frank Chapman, said the investment would develop the world's first LNG plant to be supplied by coal seam gas, and it will be the foundation project at the center of a major new Australian export industry.

The first LNG exports of up to 9.5 million tons a year from Curtis Island, just off the east coast town of Gladstone in the lower reaches of the Great Barrier Reef, are expected to begin in 2014.

"We have binding commitments with LNG customers in China, Japan, Singapore and Chile, and we will also continue to provide gas to markets in eastern Australia," said Catherine Tanna, managing director of BG Group's Australian sub-sidiary, QGC, which will operate the project.

Australian Treasurer Wayne Swan said the development was one of the country's largest capital infrastructure projects and represented a milestone for the national economy.

"This is a vote of confidence in the attractiveness of Australia as a place to invest and do business," Swan said.

Source: Global Times


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