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Prelude FLNG Terminal, also called Crux FLNG, is an LNG terminal in Western Australia, Australia.
Location
The terminal is located 475 km northwest of Broome, Western Australia.[1]
Project Details
- Operator: Shell[2]
- Owner: Shell (67.5%), Inpex (17.5%), CPC (5%), Kogas (10%)
- Parent company: Shell (67.5%), Inpex (17.5%), CPC (5%), Kogas (10%)
- Location: Browse Basin, Western Australia, Australia
- Coordinates: -15.2539252, 123.5381736 (exact)
- Capacity: 3.6 mtpa[2], 0.52 bcfd[2]
- Cost: A$24 billion[3]
- Status: Operating[4]
- Type: Export
- Start Year: 2019[5]
Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day
Background
Prelude Floating LNG Terminal is an offshore LNG terminal under development in Western Australia, Australia.[6] Its close neighbor is Inpex-owned Ichthys LNG Terminal.[7]
Prelude is longest vessel ever built. It is 1,601 feet (488 meters) long and weighs about 600,000 metric tons.[8]
Construction on Prelude began in late 2012.[8]
The facility had announced legally binding buyer agreements.[9]
As of early 2017 Prelude was still under construction.[9] In June 2017 Prelude left the yard in South Korea, towed to Australia to be chained to the ocean floor off Australia. The first cargo of fuel is likely by mid-2018.[8]
Reuters reported in October 2017 that Wheatstone LNG Terminal in Western Australia is the sixth out of eight projects in a $200 billion Australian LNG construction boom with two more facilities to be launched. The two remaining are Shell’s Prelude Floating LNG Terminal and Ichthys LNG Terminal owned by Japan's Ichthys.[10]
The terminal began commercial operations in December 2018.[11] After a series of safety incidents in late 2019 and early 2020 the terminal was shut down in February 2020 and remained shut down as of April 2020.[12]
In April 2020, Shell announced that it was delaying a final investment decision, originally planned for 2020, on its Crux gas field in offshore Australia due to the economic downturn resulting from the COVID-19 pandemic. The Crux project, also part owned by Osaka Gas, is intended to supply backfill gas to the Prelude facility.[13]
In January 2021, LNG cargo shipments resumed at Prelude.[14]
In July 2021, workers onboard Prelude made an official complaint to the offshore regulator, NOPSEMA, urging it to investigate alleged breaches of fatigue management standards as they claimed to having been forced to work on only two to three hours of sleep at certain periods over several months. Representing the workers, union group Offshore Alliance said that the situation "reflects the appalling [occupational health and safety] culture within a number of Prelude management ... It is only luck that there was not a serious accident or fatality during this period."[15]
In May 2022, Shell Australia and SGH Energy took a final investment decision (FID) to develop the Crux gas field in Western Australia, which is expected to begin production in 2027 and supply up to 550 mmscfd (on an annual basis, a maximum equivalent to 4.2 mtpa) to Prelude FLNG Terminal.[5]
Outages
After a series of safety incidents in late 2019 and early 2020 the terminal was shut down in February 2020 and remained shut down as of April 2020.[12]
In June 2020, and with operations at Prelude still frozen, growing skepticism emerged from global banking analysts about the vastly expensive project's economic feasibility. One assessment from Goldman Sachs reckons the project to be the world’s most expensive new LNG project with a “commercial break even” cost of almost $20 per thousand cubic feet. On this estimate, Prelude's material costs are more than double LNG from other new projects and four times the cost of LNG produced in Qatar, the world's LNG leader.[16]
A further setback for the Prelude project took place in September 2020 when it was reported that Shell's efforts to bring the terminal back into production had been thwarted by a failed gas seal just days after the company had opened subsea wells for the first time in seven months. The seal's failure did not cause gas to escape but Shell was forced to stop gas flow as a precaution.[17] In October 2020, Shell said that it did not expect full production at Prelude to happen before the end of the year and that it hoped to resume shipping in the first quarter of 2021. This will mean a full year of fixing problems at the floating terminal instead of producing.[18]
In December 2021, Prelude FLNG was shut down because of a fire incident following a power outage. The facility resumed operations in April 2022.[19][20]
On June 10, 2022, the Prelude facility was shut down due to industrial action taken by union workers over a pay dispute with the operator Shell. It was reported in mid-August 2022, with the dispute still not settled, that the industrial action was scheduled to continue until September 1. Union representatives estimated that the Shell's losses due to the production shutdown amounted to approximately $1.3 billion.[21]
On September 19, 2022, Shell announced that production had restarted at the terminal and that the first LNG cargo since July was being prepared for send out.[4]
In December 2022, production was again halted due to a small fire. The terminal resumed operations in January 2023.[22]
In its 2023 World LNG Report, IGU reported that Prelude's performance in 2022 was far below that of the prior year, averaging a capacity utilization of just 32%.[23]
In September 2023, Shell shut the terminal down for several months for scheduled maintenance.[24] In December 2023, the terminal resumed operation after maintenance.[25]
Natural gas in Australia
As of 2017, Australia is the second largest LNG exporter after Qatar. The country exports almost 44 million tons a year.[26]
Prelude may position Australia to overtake Qatar as the world's biggest exporter of the fuel in the coming years.[8]
Articles and resources
References
- ↑ PRELUDE FLNG MARINE TERMINAL, Shell Australia, accessed March 2019
- ↑ 2.0 2.1 2.2 International Group of Liquefied Natural Gas Importers (May 24, 2022). "Annual Report 2022 Edition" (PDF). GIIGNL. Retrieved July 11, 2022.
{{cite web}}: CS1 maint: url-status (link) - ↑ Peter Milne. "Shell's giant $24b Prelude LNG ship shut down after fire". WAtoday. Retrieved 2022-07-21.
- ↑ 4.0 4.1 Shell confirms restart of Prelude FLNG shipments, LNG Prime, Sep. 19, 2022
- ↑ 5.0 5.1 GIIGNL. The LNG Industry: GIIGNL Annual Report 2023. July 14, 2023.
- ↑ Prelude Floating LNG Terminal, Wikipedia, accessed April 2017
- ↑ Kate Wild,"NPEX joint venture seeks to dump $30 million of federal environmental projects," ABC News, Mar. 30, 2016
- ↑ 8.0 8.1 8.2 8.3 Robb M. Stewart, "Why Has BC’S LNG Industry Stalled?," Sightline, June 28, 2017.
- ↑ 9.0 9.1 "2017 World LNG Report" International Gas Union, Accessed June 20, 2017.
- ↑ Sonali Paul, Henning Gloystein, "Chevron starts LNG output at Australia's Wheatstone, first cargo expected in weeks," Reuters, October 8, 2017.
- ↑ Shell kicks off production at Prelude FLNG, Offshore Energy, Dec. 26, 2018
- ↑ 12.0 12.1 Prelude floating LNG giant still offline after two months, Upstream Online, Apr. 2, 2020
- ↑ Shell and partners delay decision on Australia's Crux gas project, Reuters, Apr. 7, 2020
- ↑ Kevin Morrison, "Australia's Prelude FLNG shipments resume: Shell,", Argus, Jan. 11, 2021
- ↑ Damon Evans, "Sleep-deprived workers at Shell’s Prelude FLNG make official complaint", Energy Voice, Jul. 20, 2021
- ↑ Tim Treadgold, "Shell’s $12 Billion LNG Experiment Becomes A Big Headache,", Forbes, Jun. 23, 2020
- ↑ Peter Milne, "Leak sets back Shell’s restart of Prelude LNG,", Boiling Point, Sep. 7, 2020
- ↑ Sonali Paul, "Shell's Australian Prelude LNG will not resume shipping LNG this year,", Reuters, Oct. 15, 2020
- ↑ The LNG Industry: GIIGNL Annual Report. GIIGNL. May 2022.
- ↑ "Shell's Prelude FLNG resumes operation". Offshore Energy. 2022-04-11. Retrieved 2022-06-10.
- ↑ Bojan Lepic, Shell To Keep Prelude FLNG Shut Down Over Pay Dispute, Rigzone, Aug. 19, 2022
- ↑ Shell resumes cargoes from Prelude LNG after nearly a month. Reuters. January 18, 2023.
- ↑ IGU. 2023 World LNG Report. July 12, 2023.
- ↑ "https://lngprime.com/australia-and-oceania/shell-says-prelude-flng-maintenance-to-take-several-months/91177/".
{{cite web}}: External link in|title= - ↑ "Update: Shell's Prelude FLNG ships first cargo after maintenance". LNGPrime. Dec 28, 2023. Retrieved May 23, 2024.
{{cite web}}: CS1 maint: url-status (link) - ↑ Qatar Moves to Ensure LNG Dominance, Arab Gulf States Institute in Washington, April 17, 2017.
