THE DEVELOPMENT OF THE GREATER GORGON GAS FIELDS

Abstract

The vast reservoirs of untapped natural gas found in the Greater Gorgon area off Western Australia’s Pilbara coast contain in excess of 11 billion cubic metres (40 trillion cubic feet) of gas, representing some 25% of Australia’s total known gas resources. Developing this world-class resource is a matter of national importance as it would secure Australia’s position as a leading gas producer and provide a huge new source of wealth for both Australia and Western Australia.

The key to unlocking the Greater Gorgon reserves is the development of the Gorgon field—one of the largest single gas fields ever discovered in Australia. Establishment of gas processing infrastructure on Barrow Island—which lies between the gas field and the mainland—would provide a catalyst for the future development of other Greater Gorgon area fields. Gas would be processed at that facility and transported through a gas pipeline to shore, enabling large new competitive supplies of gas to be delivered to the mainland.

While the development of Gorgon gas would bring significant benefits—A$11 billion investment, A$17 billion in Commonwealth and State taxes and royalties and an annual increase in the nation’s export income of A$2.5 billion—the Gorgon gas field presents some unique challenges. With little associated liquid hydrocarbons, development costs must be kept to a minimum to maintain commercial viability. In addition, Gorgon gas contains a relatively high content of carbon dioxide (CO2) which results in substantial treatment cost and relatively large potential greenhouse gas emissions.

Barrow Island—both an internationally important nature reserve and Australia’s largest operating onshore oilfield—has emerged as the development location that would enable gas from the Gorgon gas fields to be competitive in today’s market. The Western Australian Government has said the Gorgon venture (ChevronTexaco, Shell and ExxonMobil) must demonstrate at a strategic level that the proposed Gorgon gas development on Barrow Island can generate economic and social benefits, provide net conservation benefits and mitigate potential on-site impacts.