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Exxon, BHP to Pump over $1B in Developing Longford Gas Facility

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ExxonMobil and BHP Billiton announced in separate statements Thursday that they will spend over $1 billion to construct a gas conditioning plant their jointly-owned Longford facility, in Gippsland, southeastern Australia.

In its statement, Esso Australia – a part of the ExxonMobil Australian group of companies – said that the project will create around 250 direct construction jobs, as well as provide other indirect opportunities.

BHP disclosed in its statement that it will spend $520 million in the project, while Esso revealed that it is investing a similar amount.
The conditioning plant – which can produce up to 400 million cubic feet of natural gas per day – will receive gas feed from the Kipper, Tune and Turrum fields in the Bass Strait; a $4 billion project which the two companies and Santos are developing.

"Australian energy consumption will continue to grow during the next 20 years. The gas conditioning plant will process gas to help meet this expected increase in demand. And because of its cleaner-burning qualities, natural gas is a power option for reducing the environment impact of energy use," ExxonMobil Australia's Chairman John Dashwood said in the company's issued statement.

Construction of the plant is expected to commence in 3Q 2016, subject to regulatory approvals. The facility is expected to be operational in 2016.

Australia's Bureau of Resources and Energy Economics (BREE) noted in a report issued in July this year that Australia's domestic gas consumption will increase three percent a year, between 2009 to 2010 and 2034 to 2035; more than doubling to 67 billion cubic meters by 2035. This expected growth, BREE said, is driven primarily by the electricity generation sector and the mining sector.  

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