From Australia (RW): Nexus Energy has missed its much trumpeted end of-2011 deadline for a final investment decision about development of the Crux (SEN, 28/17) liquids project in the Browse Basin, offshore Western Australia.
Nevertheless the company says it is still in discussion with Chinese-led partners and lenders aiming at reaching the elusive FID during the first quarter of 2012.
Nexus secured Crux field permit back in 2006 and has been trying to get development underway ever since. Its endeavours were set back in 2008 when a A$225mn deal to sell a 25% stake in the field to Mitsui of Japan fell through. The world global financial turbulence added to the woes.
In 2011, managerial problems caused a problem when recently appointed MD Richard Cottee left unexpectedly over a difference of opinion with the majority of the board.
Mercurial
Nexus’ problems with its other asset – the producing Longtom (28/19) gas field in the Gippsland Basin, off eastern Victoria – didn’t help either. In April 2011, production was halted when mercury was detected in the wellstream. The field was off line for five months. On top of that, the routine monitoring of reservoir pressure data began to indicate the field was more complex than first thought.
Despite all this, Nexus remains upbeat. As well as talks with the Chinese, the company is holding detailed discussions with Shell to consider development of Crux via a Shell-led integrated development, such that gas and liquids would be produced together.
At the moment, the plan remains for Nexus to develop the liquids and re-inject the gas. The gas rights were sold to Shell in 2010 in a deal which enables Shell to take over the field on 1 January 2021 to produce the gas and any remaining liquids. Shell is thought to be interested in piping the gas to its Prelude (28/13) FLNG facility further to the southwest, but it could also establish a new gas processing facility at Crux.
Another delay
Flex LNG has officially delayed the final investment decision for the proposed Papuan Gulf floating LNG project (28/18) in Papua New Guinea until the first quarter of 2012.
FID for the project, operated by InterOil, was originally slated for 15 December 2011.
The Gulf LNG project is aiming at production of 5mt/a of LNG from 2014 using gas from the onshore Elk-Antelope field west of Port Moresby. Of this production, 3mt/a will be produced at an onshore plant, while 2mt/a will come from the FLNG vessel moored at a nearby jetty.
FEED has been completed for the FLNG vessel which will be built by Samsung Heavy Industries in South Korea.
