Construction Set to Start on Nord Stream 2 Pipeline in Danish Waters
BERLIN, Jan 15 (Reuters) – The Russia-led Nord Stream 2 (NS2) consortium on Friday said preparatory work to complete the subsea gas pipeline to Germany in Danish waters can go...
May 27 (Bloomberg) — Australia may lose A$100 billion ($96.5 billion) of potential liquefied natural gas projects to East Africa and North America unless costs in the nation are reduced, according to an industry group.
“Australia’s attractiveness as a place to invest is under enormous pressure,” the Australian Petroleum Production & Exploration Association said yesterday in a statement before its conference scheduled to start in Brisbane today.
Energy companies from Chevron Corp. to BG Group Plc are building almost A$200 billion of LNG export projects in Australia to tap rising Asian demand. Gas producers are considering a further A$100 billion of plants, now in doubt unless the industry rectifies high costs, low labor productivity and duplication of regulation, APPEA said.
Woodside Petroleum Ltd., Australia’s second-largest oil producer, last month scrapped a plan to build an onshore liquefied natural gas project estimated at $46 billion in favor of studying cheaper options as costs rise.
Delays and spending over-runs are endemic, according to an April report from Sanford C. Bernstein & Co., which estimates that projects in Australia run from 15 percent to 50 percent over their original cost estimates.
BHP Billiton Ltd., the world’s biggest mining company, and rivals are also being dogged by surging costs. Producers of everything from gold to coal are firing workers and putting assets up for sale, as they are squeezed by unfavorable foreign exchange rates, lower prices and higher labor costs.
Further clouding the outlook for companies in Australia, the U.S. Energy Department is weighing 19 applications from companies seeking to build export terminals and sell natural gas, converted into liquid form, to nations without free-trade agreements with the country. That list includes Japan and most of Europe.
Earlier this month the department gave conditional approval for the Freeport LNG project in Texas, the second export application approved under President Barack Obama’s administration.
The Australian gas industry will deliver more than A$13 billion a year in royalties and taxes by 2020, APPEA said, citing data from Deloitte Access Economics.
– James Paton, Copyright 2013 Bloomberg.
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