Australia's LNG Highway Closer to Reality as BOC Gases Awards EPC Contract for LNG Plant

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Researched by Industrial Info Resources (Perth, Australia)--Plans for Australia's "LNG Highway," which is to stretch almost the full length of the eastern coast, are one step closer, with BOC Gases Australia (North Ryde, Australia) awarding a contract for the engineering, procurement and construction (EPC) of its Chinchilla Micro liquid natural gas (LNG) Plant to Gas Liquid Processing Engineering Pty Limited (GLP) (Tullamarine, Australia).

The Queensland plant, located 35 kilometres (22 miles) west of the town of Chinchilla and 280 kilometres (174 miles) from Brisbane, will be the first plant of this type built in mainland Australia. It is an important step in the LNG Highway, which will run from Central Queensland in the north, to Melbourne on Australia's southeast coast, and on then across the Bass Straight to Tasmania.

This is the second time GLP has been awarded an EPC contract by BOC for the LNG Highway. BOC awarded the EPC contract to GLP for Australia's first Micro LNG Plant, located in Westbury, Tasmania, which was successfully commissioned in 2010.

The Chinchilla plant will use the same technology as the Westbury facility and is expected to produce 50 tonnes of LNG per day by the second quarter of 2014. This is the equivalent of 70,000 litres of diesel, for use by heavy transport and industry. Both of these sites were designed with future expansions in mind, and both can accommodate the building of a second train as demand increases.

BOC has said it has plans to build and operate a $210 million (AUD$200 million) interstate network of LNG refuelling stations for the trucking industry. LNG for these refuelling stations will be sourced from the existing Longford LNG Plant, which sources natural gas from the offshore gas fields of Victoria, and from the new Chinchilla facility, which is being built near the coal seam gas fields of the Surat basin in southern Queensland.

Coal seam gas sourced from the Surat Basin tends to be more than 98% methane, with only small amounts of nitrogen and carbon dioxide. Therefore, it requires little treatment before it is turned into LNG by cooling it to about -162 degrees Centigrade (-259 degrees Fahrenheit). LNG is considered to be one of the safest and most environmentally friendly transport fuels, offering significantly lower carbon dioxide and other greenhouse gas emissions.

"Using coal seam gas to create LNG as a transport fuel is an Australian first," said Colin Isaac, BOC's South Pacific Managing Director. "When construction is complete, this plant will supply a cleaner fuel than diesel, with a more stable price. That's a big win for trucking operators, for the environment and the local economy. LNG is a reliable and proven technology that will offer Queensland's trucking operators an economically and environmentally appealing alternative to diesel. Importantly, natural gas is a well-accepted fuel, with more than 10 million vehicles worldwide fuelled by natural gas."

In Australia, buses that use LNG already operate in Sydney, Brisbane, Adelaide, Perth and Canberra.

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