Ichthys LNG Terminal, Darwin

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The Ichthys liquefied natural gas (LNG) terminal is part of the $34bn Ichthys LNG project in Darwin, the capital city of the Northern Territory in Australia. The Ichthys LNG project will be one of the largest LNG export facilities in Australia. The Ichthys Field is located in the Browse Basin, offshore from Western Australia. It is estimated to have a resource base of 12.8 trillion cubic feet of gas and 527 million barrels of high value condensate. First production from the field is expected in 2016. The onshore LNG terminal will process the gas produced from the field. The Australian Government granted a production licence for the LNG project in March 2012, two months after the final investment decision (FID) was confirmed by the project partners, INPEX and Total. Construction on the LNG project was officially started in May 2012. INPEX is the operator of the field with a working interest of 66.070%. Total holds a working interest of 30% in the project with Tokyo Gas, Osaka Gas, Chubu Electric and Toho Gas as the minor shareholders The onshore LNG terminal will handle about 8.4 million tons of LNG and 1.6 million tons of liquefied petroleum gas (LPG) per annum. In addition, it will process up to 100,000 barrels of condensate a day. The natural gas will be exported from the Ichthys field via an 889km offshore pipeline. The LNG plant will separate condensate and LPG from the natural gas. The resulting natural gas will be cooled to -162 degrees Celsius using two LNG trains, to obtain liquefied natural gas (LNG). INPEX assessed a number of possible locations for the onshore gas processing facility in 2002. Marret Islands, located about 200km south-east of the Ichthys Field, was found to be the most suitable location for the facility. This selection was based on the environmental, political, engineering and commercial perspectives which were prevalent at the time of the assessment. The Marret Islands location was scrapped in 2007 after the Northern Territory Government offered the Blaydin Point site in Darwin for the gas processing facility. This site is primarily reserved for industrial development and is also the government’s preferred site for an LNG facility. The infrastructure of the Ichthys processing plant will include two gas liquefaction trains with a combined capacity of 8.4 million tons per annum, gas treatment facilities, separate storage tanks for LNG, LPG and condensate, plus a product offloading jetty. A condensate stabilisation plant, propane and butane fractional plant will also be part of the facility. Other infrastructure will include administration facilities, power generation infrastructure, a wastewater drainage and treatment system, control room, firefighting system, fuel storage area, warehouse and security buildings. Gas produced from the Ichthys Field will first be pumped to a central processing facility (CPF) via a subsea gas pipeline, and then to the Blaydin Point onshore gas processing facility through a multiphase gas export pipeline. The total length of the export pipeline from CPF to the LNG plant will be 889km. It will have an outer diameter of approximately 42in (1.06m) and will be placed as deep as 250m. In order to provide mechanical protection and stabilisation on the seabed, the pipeline will be weight-coated with concrete. The sale of the entire output of LNG from the Ichthys LNG Project was finalised in January 2012. As per the Sales and Purchase Agreements (SPA), CPC Corporation will get 1.75mtpa, Chubu Electric will get 0.49mtpa and Toho Gas will get 0.28mtpa for 15 years. The SPA will be effective from 2017. An SPA was also signed in December 2011 between the project owners and a consortium of five Japanese utility companies for the sale of 4mtpa of LNG. The JKC joint venture was awarded an engineering, procurement and construction (EPC) contract worth $15bn in February 2012 for the Ichthys onshore LNG plant facility. KBR, GC Corporation and Chiyoda Corporation are partners in the joint venture. The site development and civil works contract for the processing plant was awarded to the Macmahon – John Holland joint venture in March 2012. The contract is worth approximately $350m and includes access roads, earthworks, drainage and ground improvement works. The gas export pipeline will be laid by Saipem, while the coatings will be made by Mitsui and Bredero Shaw. Mitsui-Europipe, Sumitomo and Nippon Steel-Metal One are responsible for manufacturing the pipeline.

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