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Shell Prelude boss Rob Jager talks about the world’s biggest offshore facility

Shell veteran Rob Jager had been contemplating retirement in his native New Zealand when he got called up to take responsibility for the world’s biggest offshore facility.

When he arrived in Perth in November, Shell’s 488m-long Prelude floating LNG project had been moored to the seabed off the Kimberley for 12 months and was yet to produce.

Six months later, Prelude has produced condensate. It is still to churn out LNG but when Mr Jager,right, talks about the project there is one point he makes above all else: “We’re not driven by milestones, we’re not driven by schedule, we’re driven … to make sure that it’s safe to start up.”

Safety is what he is noted for in New Zealand. After a royal commission into the 2010 Pike River mine disaster that killed 29 miners, the then chairman of Shell New Zealand was chosen in 2012 to lead an independent task force on workplace health and safety.

Mr Jager said the once-in-a-lifetime opportunity had been “spectacularly successful” with most recommendations implemented and the safety statistics improving but “not as fast as we would like”.

He has also been a director of Air New Zealand for six years and chairs its safety committee.

A measured approach is wise for Prelude, which may be a massive structure but is a relatively small LNG project.

“It’s like an offshore platform, and a bunch of pipelines, and an onshore LNG plant, and a storage facility, and utilities, and a hotel for 300 people, and a port, and all of that on a floating facility,” Mr Jager said.

“Its individual parts in and of themselves are not hugely complex but putting it all together in a confined space is what makes it challenging.”

It took “longer than hoped” but the wells were opened on Christmas Day, and in March the first tanker of condensate was loaded.

The wish not to be driven by schedule was not helped this month when Shell chief financial officer Jessica Uhl said the first LNG cargo was expected by the end of June.

Mr Jager would not say what problem was stopping LNG production other than it was known.

Until there is a fix the wells are producing the minimum amount of gas possible, with gas not used to power the facility being flared.

About 300 workers are on Prelude now, the maximum it can take within its targeted 100 per cent redundancy in lifeboat capacity.

When the workers produce LNG, Prelude will have to fulfil what Mr Jager regards as its unique and underrated role — an open sea port.

He said transferring LNG between the Prelude and an LNG carrier as they moved separately from the wind and waves, and the Prelude weather-vaned around its turret mooring, was complex.

“We still have to work our way through that process and substantiate the modelling that we’ve done,” he said.

Prelude has twice imported LNG from a carrier moored alongside in a partial test of an eventual production line that will load an LNG carrier every five to seven days.

Mr Jager said achieving predictable and safe operation at Prelude would be his biggest challenge.

It will be much harder than for a conventional LNG project that pipes offshore LNG to a spacious onshore LNG plant.

There is no large pipeline to buffer the LNG plant from disruption from the subsea gas supply, less LNG stored to fill carriers if the plant trips, and a shutdown is more likely to affect the entire facility.

Through it all, Mr Jager wants to methodically take his team through identifying and managing the risks towards Shell’s goal of zero incidents. “Again, it comes back to the complexity of Prelude,” he said. “Prelude will be a success.”

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