BG Group claims $20.4bn liquefied natural gas project is on track

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Source: Energy Institute (EI)

The BG Group has claimed that its $20.4bn (£12.38bn) liquefied natural gas (LNG) project is on track - and the organisation has also held out the possibility of a potential collaborative endeavour with various rival groups that operate in the area.

Curtis Island in Australia is the location for the project and BG Group chief executive officer Chris Finlayson - who took charge of the firm one year ago - told the Financial Times that he is very confident for the future success of his enterprise.

'Yes, I think I am [confident],' he remarked, adding: 'It is a big thing to say when you are looking out six or seven years.'

The LNG project is the first to turn gas sourced from a coal seam into the liquefied version of the fuel - and it has so far been beset by a wide range of cost increases.

Mr Finlayson attributed the majority of these to foreign exchange issues, going on to claim that the main work surrounding the project is going very well.

He said that the execution itself is fine and that he expects the coming year to be all about the delivery of various operations.

'What makes you more money is not really the day you say ... We are producing gas, it's how fast you can ramp up to full capacity,' Mr Finlayson commented.

Some 2,000 wells will be drilled for the start of the project - and this makes it a significantly larger undertaking than Mr Finlayson's previous LNG project.

This was named Sakhalin 2, which he was responsible for during his time at Royal Dutch Shell and helped to bring online with just four wells.

BG Group's current project is one of three that are under construction to sell LNG to customers in Japan and South Korea. The other two are being developed by Australian groups Origin Energy and Santos.

Further discussion about LNG projects and the strategic outlook for growth of gas demand and its place in the future energy mix will be discussed at the annual gas conference during IP Week in February 2014.

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