Australia Tells Shell to Keep Prelude FLNG Unit Offline Until It’s Proven Safe for Workers

Under the direction of Australia’s offshore energy regulator NOPSEMA, Shell Australia is to “undertake an investigation and create a plan, schedule and commitment to take all necessary corrective actions and demonstrate that the facility can operate safely in the event of power loss” before production can be restarted.

The direction comes after an electrical fire on December 2 led to a complete loss of power to the facility, resulting unreliable and intermittent power for three days. Media reports say the facility was partially evacuated, leaving only a skeleton crew for essential functions.

NOPSEMA launched an investigation the day after the outage and sent a team to inspect the facility on December 8, which determined that the operator, Shell Australia, “did not have a sufficient understanding of the risks of the power system on the facility, including failure mechanisms, interdependencies and recovery.”

NOPSEMA said that the power failure directly impacted “emergency response capability, operation of safety critical equipment (e.g., communications, access to safety critical documentation and information, Permit to Work System) and evacuation of personnel by helicopter or boat.”

Also impacted were essential services for personnel, such as lighting, safety systems, communication systems, potable water systems, sewage treatment and HVAC, in addition to “process equipment required to effectively manage the LNG inventory.”

While the direction acknowledged that Shell is conducting an investigation into the incident, NOPSEMA believes the proposed scope of the investigation doesn’t provide for a thorough enough review of the root cause and entire series of events leading to and during the incident, nor the risks for future similar incidents and actions to mitigate them.

Prelude FLNG is permanently moored about 295 miles off the coast of Western Australia and produces LNG at sea before loading it directly onto ships for export to customers around the globe. The massive structure has been billed as the largest floating object ever constructed, measuring 488 meters in length and displacing nearly 600,000 tonnes.

Shell Australia shipped its first cargo from the facility in 2019, but so far the facility has been plagued with problems and delays and it has yet reached its full production capacity of 3.6 million tonnes of LNG per year.

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