Australia Pacific LNG Awards Key Contracts

Australia Pacific LNG announced Tuesday it had signed two key upstream design, engineering and construction contracts for its coal seam gas (CSG) to liquefied natural gas (LNG) project, progressing towards a final investment decision at the end of 2010.

These contracts were awarded to McConnell Dowell Constructors (Aust) Pty Ltd and Consolidated Contractors Australia Pty Ltd Joint Venture (MCJV) for the pipeline, and Baulderstone Bilfinger Berger Services (Australia) Pty Limited Joint Venture (BBBJV) for the upstream facilities contract.

The agreements with MCJV and BBBJV include key engineering, procurement and construction contract terms. The awarding of these two contracts follows the recent announcement of the Savanna Energy Services Pty Ltd. rig contract.

Australia Pacific LNG Project Director, Todd Creeger said, "The awarding of these upstream facilities and pipeline contracts is consistent with the project plans we have communicated earlier. The experience these contractors have in delivering major projects on-time and within cost estimates were a key factor in the awarding of the contracts."

Speaking on behalf of the upstream operator for Australia Pacific LNG, Origin's Executive General Manager, Upstream Oil and Gas, Mr Paul Zealand said, "Design studies for the upstream facilities and gas pipeline have been undertaken and detailed engineering and preparatory works will continue with the constructors.

"Both the pipeline and upstream contracts are scalable to include the entire 450 kilometer gas transmission pipeline construction and a portion of the gas production facilities for the project. Importantly, both contractors also share Australia Pacific LNG's expectations with respect to safety and local content," he said.

The Australia Pacific LNG project is expected to create a significant number of jobs, including those jobs directly related to pipeline construction.

Australia Pacific LNG is a 50:50 joint between Origin Energy and ConocoPhillips that will bring together Origin's 10 and ConocoPhillips' 25 years of CSG experience, as well as ConocoPhillips' 40 years experience in operating and developing LNG facilities.

Australia Pacific LNG is a 50:50 Coal Seam Gas to Liquefied Natural Gas joint venture between Origin and ConocoPhillips. Origin and ConocoPhillips are leaders in the development of CSG and Australia Pacific LNG is already producing almost 40 percent of Australia's total CSG production to meet domestic market requirements. Australia Pacific LNG holds the largest CSG reserves in Australia. APLNG's project stretches from the Surat and Bowen Basins along a 450km pipeline to a site at Laird Point on Curtis Island off Gladstone. Origin is Australia's largest integrated energy company and ConocoPhillips is a leader in the development of LNG projects internationally including the existing plant in Darwin, Australia.

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