Monday, July 9

CSG industry in crisis as gas plays face $20bn blowout

QUEENSLAND'S burgeoning $60 billion coal-seam gas export industry is facing growing doubts about its ability to supply enough gas to three giant export plants due to start in Gladstone in 2014, and to contain development costs.
A withering assessment of the projects was delivered this week by US researchers Bernstein, whose Hong Kong-based energy analysts claimed the industry was in crisis and faced another $US10bn ($9.75bn) in blowouts on top of about $US10bn announced in recent months.

This came in an estimate, which was not backed up by other analysts, that 12,000 more onshore CSG wells than planned may have to be drilled, taking total wells drilled to about 30,000.

While Melbourne-based analysts at UBS and Morgan Stanley gave a more circumspect view of the progress of Origin Energy, Santos and some of the world's biggest oil majors working to export through Gladstone, there is a growing feeling that the industry will struggle to supply all the gas needed by the plants.

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The Australian

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