Samsung: Shell’s FLNG facility will cost $3 billion

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June 1, 2011

LONDON -(Dow Jones)- A regulatory filing by South Korea’s Samsung Heavy Industries Co. Ltd. (010140.SE) has revealed that Shell’s recently announced floating liquefied natural gas facility, being built for the Prelude gas field offshore Western Australia, will cost 3.27 trillion won ($3 billion).

Shell Wednesday declined to detail the exact cost of the giant vessel, which is designed to chill natural gas for export at sea. However, last week Malcolm Brinded, Shell’s Executive Director Upstream International, said it would be in the “ballpark” of $3 billion-$3.5 billion per one million metric tons of production capacity, equating to $10.8 billion-$12.6 billion.

Samsung will build the facility as part of a consortium with France’s Technip SA (TEC.FR). The Technip Samsung Consortium will engineer, procure, construct and install the vessel, according to the filing, which also said the contract period will run from June 1, 2011 to Sept. 30, 2016.

Six-times heavier than the world’s biggest aircraft carrier and 488 meters long, Prelude will float in waters off the northwestern coast of Australia. It will be capable of producing 3.6 million metric tons a year of LNG and additional volumes of condensate and liquefied petroleum gas.

-By Alexis Flynn, Dow Jones Newswires

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