In the beginning

Historically, Macedon Gas Field proponents BHP and Apache Northwest, had considered a range of development alternatives for the project. Yet none of these proved commercially attractive due to the small size and remoteness of the field, as well as technically limiting design issues.

The Macedon Gas Field has an estimated gas-in-place volume of approximately 800 billion cubic feet (Bcf), with a current estimate of proved recoverable gas in the order of 600 Bcf. BHP found that this volume of gas would be insufficient to support long-term contracts required for a stand-alone LNG project. Additionally, BHP stated that transportation of Macedon gas to an existing LNG plant would not be economically viable due to the distance of the field to onshore plants.

BHP had found there was previously insufficient demand in the domestic market to warrant development of a domestic gas project. However, the combination of increased demand for domestic gas and technological advancement offered the company the opportunity to develop the Macedon Gas Field in an economically feasible way.

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First steps

BHP plans to pipe gas from the field via a 500 mm diameter, 75 km subsea pipeline and 15.5 km onshore pipeline to a 200 Million cubic feet per day gas plant at Ashburton North. The 67 km, 500 mm diameter Macedon tie-in will connect the gas plant to the Dampier to Bunbury Natural Gas Pipeline.

The plant itself will be powered by a gas-fired power station. An initial environmental report was prepared for BHP in July 2009, involving consultation with the local community and other key stakeholders. A number of different groups were asked for their input including: the Cape Conservation Group, the Conservation Council of Western Australia, the Department of Sustainability, Environment, Water, Population and Communities, and the Buurabalayji Thalanyji Aboriginal Corporation Department of Indigenous Affairs.

It was expected that the project would be sanctioned as early as May 2010, when BHP Chief Executive Officer Michael Yeager announced that project engineering was in its final stages of completion. Once the Environment Protection Authority granted approval in July 2010 for the construction of a subsea and onshore pipeline, a final investment decision followed shortly after in September 2010.

In December 2010, Oceaneering International was contracted to the project to supply umbilicals and distribution equipment, which include supplying an integrated umbilical system consisting of approximately 100 km of steel tube umbilicals and associated distribution equipment, including termination assemblies and flying leads.

Current status

2011 has seen further contracting developments for the $A1.43 billion gas project, with Technip being awarded a contract in May for the engineering work and services related to procurement and construction management for the project’s onshore gas plant and pipeline works.

Technip’s operating centres in Perth and Kuala Lumpur will execute the contract, which is scheduled to be completed in 2013.

June saw BHP award an $A45 million contract for pipeline construction work to a Streicher-Clough joint venture. The scope of work includes horizontal directional drilling, construction of an onshore wet gas pipeline, sales gas pipeline and umbilical installation. A spokesperson from Clough told Gas Today that engineering work commenced in June 2011, and completion is on track for May 2012.