Chevron Reports “Extensive Damage” at Major LNG Project

Chevron’s Wheatstone LNG plant offshore Australia has suffered “extensive damage” from a cyclone that recently passed through Australia.

The two liquefaction trains at the facility remain shut, Reuters quoted Chevron’s Australian director of operations and maintenance as saying.

“We have a number of fin fans or air-cooled heat exchangers that sustained some damage,” Danny Woodall said at an industry event in Sydney. “We’ve got a dedicated team right now that is ‌working on getting those repaired,” he added.

Tropical Cyclone Narelle last week disrupted operations at a total of three LNG facilities in Australia, including Chevron’s Gorgon and Wheatstone, worsening an increasingly severe global LNG supply crunch. Gorgon only had to suspend operations at one of its three liquefaction trains. The other two are operating as normal.

Santos was the first to report a shutdown at its Barossa gas field, which feeds the Darwin LNG terminal, earlier this week as a tropical cyclone barreled towards Australia. Chevron reported the outages at Gorgon and Wheatstone earlier today, as quoted by Reuters on Friday, with a spokesperson saying that “We will resume full production at both facilities once it is safe to do so.”

Woodside also reported cyclone-related disruptions at a facility linked to its North West Shelf LNG project.

Natural gas prices in Asia have swelled by 143% since February 28, and European gas prices have gone up by 85%, and while some observers make a point of noting that even with that increase, prices are lower than they were back in 2022, this does not really matter. The important fact is that a sizable chunk of LNG supply has been taken off the market due to war and weather. The outlook is not particularly encouraging, either, with QatarEnergy saying earlier this month it would take it years to repair its LNG facilities damaged by Iranian missiles.

By Irina Slav for Oilprice.com

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