Tassie Shoal LNG Project Technology and Cost Estimate Update

abarrelfullabarrelfull wrote on 15 Nov 2012 19:55
Tags: australia lng meo

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MEO Australia Limited (ASX: MEO; OTCQX: MEOAY) advises that it has received the final reports recently commissioned to assess the technology basis and provide updated development cost estimates for the Tassie Shoal LNG Project (“TSLNG”). The reports were commissioned from major international engineering firms WorleyParsons and Arup, with input from APCI.

The TSLNG cost estimate is an overall capital spend of US$2.0 Billion (including contingency of 25%) to produce 3.0 million tonnes per annum (MTA) of LNG. It is estimated that an incremental investment of $220 Million (11%) is required to increase nameplate capacity to 4.0MTA (30% capacity increase). All cost estimates are on a +/-25% basis, consistent with the pre-FEED status of the TSLNG project.

MEO estimates that TSLNG (when scaled up to a 3.6MTA capacity to simplify the cost comparison) represents a ~US$2 - $4 Billion capital cost advantage for a TSLNG development compared with onshore and FLNG alternatives.

Additional activities to mature the engineering and cost estimates have been identified and will proceed commensurately with the commercial development of the project.

MEO’s Executive Manager Business Development Robert Zammit commented:
“MEO currently holds a 100% interest in TSLNG and it’s pleasing to see the globally competitive development costs re-affirmed by the technology and cost reviews by the industry’s leading engineering firms. Business development activities are focussed on providing a compelling fasttrack commercialisation path for MEO equity gas, and potentially for other regional resource owners. Additionally, TSLNG represents one of several development options for potential farminees to MEO’s WA-454P*, particularly those seeking a clear line of sight to an LNG commercialisation path with existing environmental approvals and the potential for an equity aligned upstream and midstream plant ownership structure.”

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