Wood Mackenzie: Chevron, Inpex Gas Projects Face Delays

(Bloomberg) -- Chevron Corp. and Inpex Corp. face potential delays in starting liquefied natural gas projects in Australia, according to consulting firm Wood Mackenzie Ltd.

Chevron’s Wheatstone and Inpex’s Ichthys ventures could start output in mid-2017, later than the companies forecast, Angus Rodger, Asia-Pacific analyst at Wood Mackenzie, said in an interview in Melbourne, where he’s attending a conference.

Chevron and Inpex said the projects, which will super cool natural gas for shipment to Asia, remain on schedule.

The plants are among six Australian liquefied natural gas developments under construction. While Australia is forecast to become the world’s biggest exporter of the fuel later this decade, its LNG industry has seen delays and cost overruns.

Ichthys in northern Australia must bring together multiple projects, including one of the world’s longest underwater pipelines and a central production platform, to form one development, an “extremely challenging” feat, Rodger said.

The A$29 billion ($23 billion) Wheatstone development in Western Australia is almost 60 percent complete and expected to start in late 2016, Chevron said in an e-mail. The Ichthys project, estimated to cost $34 billion, is expected to start production at the end of 2016, its website shows.

Peter Coleman, chief executive officer of Woodside Petroleum Ltd., which acquired a stake in Wheatstone earlier this year, told reporters in Melbourne Tuesday that the start-up “may or may not slip into early 2017.”

Ichthys had completed about two thirds of the construction at the end of March, Inpex said in an e-mail.

“Like any major project, especially one the size, scale and scope of Ichthys, we face challenges on many fronts, but we’re managing them all,” the company said.

To contact the reporter on this story: James Paton in Sydney at jpaton4@bloomberg.net. To contact the editors responsible for this story: Jason Rogers at jrogers73@bloomberg.net Keith Gosman, Peter Langan


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