Leighton Contractors Awarded Expanded Contract for Australia's Gorgon LNG Project

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Researched by Industrial Info Resources Australia (Perth, Australia)--Leighton Contractors (Chatswood, Australia) has been awarded an expanded contract for the Gorgon Liquefied Natural Gas (LNG) project that involves the delivery of a civil and underground works package. The initial contract with Leighton has increased by $995 million and now is worth a total estimated value of $1.83 billion. The scope of the contract has been increased and amended to provide more flexibility, to deliver the work more efficiently and timely.

The contract now includes earthworks, in-situ and precast concrete, and underground services, including drainage, piping and electrical and instrumentation cabling, which will be installed at the LNG plant site. Leighton Contractors'' managing director said that the company "is committed to continuing to work closely with Chevron to deliver this important project."

The Gorgon project is being developed in a nature reserve on Barrow Island in Western Australia by Chevron Australia Pty Limited (Perth, Australia). Chevron (NYSE:CVX) is working with Kellogg Joint Venture (Perth) and Gorgon Upstream Joint Venture (Perth) to develop the project, which, once operational, will produce about 15 million metric tons of LNG per year, with the possibility of a production expansion. The large-scale LNG project was given the development go-ahead in September 2009 and represents an estimated cost of about $53.06 billion.

The Gorgon project consists of three production trains. An output expansion has been proposed, which would increase production of each of the three trains from 5 million metric tons per year to 5.2 million metric tons per year.

Chevron is continuing construction of the LNG tanks on Barrow Island, and Leighton Contractors continuing with the civil and underground scope of works. Hyundai Heavy Industries Corporation Limited (Ulsan, South Korea) continues to deliver modules, with the first two modules now in place. These works continue within a set of complicated logistics of building such a large project on a nature reserve. Project completion is expected early 2015.

Industrial Info is currently tracking seven large-scale LNG production projects under construction in Australia, with a total investment value of more than $167.38 billion. These projects, when in full operation, will increase Australia''s LNG export capacity from about 24 million metric tons per year to more than 80 million metric tons per year.

The Kellogg Joint Venture is owned by M W Kellogg (25%), Hatch (25%), Clough (25%) and JGC (25%). The Gorgon Upstream Joint Venture is owned by J P Kenny (50%) and Technip Oceania (50%).

Leighton Contractors is a wholly owned subsidiary of Leighton Holdings Limited (ASX:LEI) (St. Leonards, Australia) and is one of Australia''s leading contracting and project development groups, with more than $11.84 billion works in hand and more than 12,000 employees across Australia, New Zealand and Papua New Guinea. The company''s portfolio is across the infrastructure, mining, telecommunications, civil construction, industrial, energy, health and services sector.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info''s quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what''s happening now, while constantly keeping track of future opportunities.