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THE AUSTRALIAN: Shell and Chevron boldly go into the abyss together

THE AUSTRALIAN: Shell and Chevron boldly go into the abyss together

Wednesday July 06, 2005

Nigel Wilson, Energy writer

CHEVRON and Shell Australia have joined forces in a bold, new program to explore the deep-water Exmouth Plateau west of the Greater Gorgon gas discoveries in the Indian Ocean.

For Shell, the program marks its return to exploration in Australia after an absence of about a decade.

Chevron and Shell successfully bid for the exploration rights to four deep-water blocks in the Carnarvon Basin.

Chevron is the operator for the 50-50 partnership which bid a three-year work program, including seismic reprocessing, more than 3000km of two-dimensional seismic, 3500km of three-dimensional seismic and the drilling of two exploration wells.

The seismic work could begin later this year. The four permit areas lie between 160km and 480km off the West Australian coast.

Chevron International Exploration and Production president John Watson said from the group’s headquarters in San Ramon, California, that the bid reflected Chevron’s commitment to the exploration and development of Australia’s petroleum resources.

Chevron Australia’s managing director Jay Johnson said Western Australia was a cornerstone of Chevron’s plans to build an international, competitive gas business to supply energy to Australia, Asia and the North American west coast.

Shell Australia chairman Tim Warren said the company was keen to add more integrated gas to its portfolio and was looking to discover more gas around the liquefied natural gas hubs of Gorgon, Browse, Sunrise and in the Timor Sea.

Chevron and Shell are partners in the $11 billion Gorgon project which has now decided to tap up to 40 trillion cubic feet of gas in the Greater Gorgon area of the Carnarvon Basin.

The deep-water Exmouth Basin contains the Scarborough gas reservoir, which BHP Billiton hopes to develop to supply its proposed Cabrillo Port LNG receival terminal in California. BHP Billiton’s Scarborough partner, ExxonMobil, remains sceptical that the reservoir contains sufficient gas to justify development.

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