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Shell Expects Output at Prelude off Australia in 2016

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By Ben Sharples

Oct. 12 (Bloomberg) — Royal Dutch Shell Plc, Europe’s largest oil company, said first liquefied natural gas from its Prelude project off northwestern Australia is expected in 2016.

A final investment decision is scheduled for early 2011 and Prelude is projected to have an operational life of 25 years, Shell said in a draft environmental impact statement posted on its Australian unit’s Web site. Shell plans to use the world’s first floating LNG plant to develop the field.

Prelude, 100 percent-owned by Shell, lies in the Browse basin off Australia’s undeveloped Kimberley coast, where more than a third of the nation’s known offshore gas is located. Production from the project is estimated to peak at 3.6 million metric tons of LNG a year, The Hague-based company said today.

Gas from the nearby Concerto, Crux and Libra fields may be processed through the floating LNG plant, Shell said. Prelude, 475 kilometers (297 miles) north, north-east of Broome in Western Australia, has a resource of between 2 trillion and 3 trillion cubic feet, the company said.

Shell in July awarded a contract to Samsung Heavy Industries Co. and Technip SA to design, construct and install floating LNG facilities over 15 years. Shell may order as many as 10 units worth about $5 billion each, Samsung Heavy estimated in a July statement.

The vessel will be “larger than an aircraft carrier,” weigh about 600,000 metric tons and be around 480 meters long and 75 meters wide, Malcolm Brinded, Shell’s executive director for international upstream business, said Oct. 8.

To contact the reporter on this story: Ben Sharples in Melbourne at [email protected]

Last Updated: October 11, 2009 22:02 EDT

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