AWE: Design competition phase of FEED for Waitsia stage 2 underway By Martin Kovacs, 8 Jun 2017

AWE, operator of L1/L2 in the Western Australian northern Perth Basin, has advised that the joint venture partners have agreed to commence the design competition phase of FEED for stage 2 of the Waitsia gas project.

AWE advised that the competition, to commence immediately and to be followed by a commercial phase, “will include a gas plant capable of processing 100 TJ/d, CO2 extraction, collection hubs and flowlines”, with the approach allowing “the joint venture to establish a high degree of capital cost certainty and will also develop and compare EPC and BOO contracting models”.

The contractors selected to proceed to the design competition are Quanta/Suez (EPC), ATCO Australia (BOO), SNC-Lavalin (EPC/BOO) and Clough (EPC), AWE stated.

AWE stated that it is targeting completion of all FEED phases by the end of the 2017 calendar year, prior to achieving a final investment decision (subject to finalising gas sale agreements).

“A design competition is the best way for the Waitsia joint venture to compare the various aspects of EPC and BOO delivery methods, while at the same time ensuring a high degree of certainty around the capital cost component,” AWE CEO and Managing Director David Biggs commented.

“In addition, AWE is currently drilling the Waitsia-3 appraisal well – the first of a two-well program which will facilitate a review of Waitsia reserves – and we are negotiating gas sale arrangements with a number of potential customers.

“When developed, Waitsia will provide around 10% of Western Australia’s gas demand. Recent market data shows that the Western Australian gas market is tightening, with new sources of gas required to meet domestic demand. Waitsia offers potential customers increased competition, diversity of supply and improved security of supply by offering a lower-risk onshore supply chain.”