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11 min ago 2 min read
Multinational energy firm Shell is investing in the next phase of Arrow Energy’s Surat Gas Project in Australia – securing long-term feedstock supply for its Queensland Curtis LNG (QCLNG) export terminal.
Arrow Energy is an equal joint venture between Shell and PetroChina. First gas is expected in 2028.
Gas from the project will supply domestic customers and long-term export contracts, as part of a 27-year sales agreement between Arrow Energy and the QCLNG joint venture.
Shell did not disclose details of the investment, covering around 140 wells, but industry reports stated it would be less than $500m.
As reported by gasworld in , QCLNG extracts coal seam gas from the Surat Basin in southern Queensland and converts it into LNG at a processing plant on Curtis Island near Gladstone for domestic use and international export. Partners include Shell (73.75%), CNOOC (25%), MidOcean Energy (1.25%).
Since Arrow Energy’s gas is processed using QCLNG’s existing upstream pipelines and treatment infrastructure, the shared infrastructure reduces capital expenditure and lowers the overall environmental footprint.
Cecile Wake, Shell Australia Executive Vice President and Country Chair, said gas is a “stabilising force” in the energy system.
Shell forecasts a to nearly 700 million tonnes per year by 2050.
However the Middle East conflict continues to impact the global LNG industry, as markets wrestle with supply disruptions, price volatility, fuel switching and demand destruction.
Australia is highly exposed to the Asian LNG market with 90% sold to four countries (China, Japan, Taiwan and South Korea). Australian exporters will likely face price pressures as existing contracts expire.
