Chevron Unveils New Discovery Off Coast of Australia

Chevron Unveils New Discovery Off Coast of Australia

Chevron Corp. unveiled another natural-gas discovery in the Gorgon area off the coast of Australia, adding to signs that the oil major may be able to expand its liquefied-natural gas project in the region.

Chevron, the world's second-largest U.S. oil and gas producer by market value after Exxon Mobil Corp., said the discovery was its 15th in Australia since mid-2009.

The discovery well, located about 75 miles northwest of Barrow Island off the Western Australia coast, confirmed about 128 feet of net gas pay.

Such discoveries bode well for Chevron, the operator of the Gorgon natural-gas project, the biggest among nearly a dozen terminals under construction or planned along Australia's coastline that aim to ship liquefied natural gas to Asian countries.

A string of gas discoveries off the Western Australia coast over the past two years has boosted confidence that Chevron can expand the Gorgon project beyond its initial annual output capacity of 15.6 million metric tons of LNG.

Chevron has a 50% interest in the permit area where the discovery is located. Exxon Mobil and Royal Dutch Shell PLC each have a 25% interest.

Copyright (c) 2012 Dow Jones & Company, Inc.

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