Thiess Wins More Work on Gorgon LNG Project

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Researched by Industrial Info Resources Australia (Perth, Australia)--Thiess, a subsidiary of Leighton Holdings Limited (ASX:LHL) (Sydney, Australia), has won an additional two years of work on the Gorgon liquefied natural gas (LNG) project. Thiess will perform "miscellaneous" civil work, as required. The scope of work is expected to include earthworks, underground services, concrete works and temporary works.

The Gorgon project's onshore downstream works, which are operated by Chevron Australia Pty Limited (NYSE:CVX) (Perth, Australia), include a 15.6 million-metric-tonne-per-annum LNG production plant; pipelines; a 300-terajoule-per-day (285 million standard cubic feet per day) natural gas processing plant; a monoethylene glycol unit; a power station; and additional infrastructure. The Gorgon downstream is situated on remote Barrow Island.

Thiess has been working on the island since 2010, performing site preparation and temporary facilities at a final contract cost of $500 million. Thiess also was part of a joint venture (Thiess Decmil Kentz Joint Venture [TDK JV]), on a $500 million design-build contract for the Gorgon construction village. The latest contract awarded to Thiess is valued at up to $212 million.

Leighton Holdings' other subsidiary, Leighton Contractors (ASX:LEI) (Chatswood, Australia), has multiple contracts on the Gorgon project. Last month, Chevron awarded an expanded contract to Leighton Contractors for the civil and underground works package. The full scope of works to be provided by Leighton Contractors on the contract is now worth a total $1.79 billion, and the company promises to deliver the contract in a more efficient and timely way.

In a joint venture with Saipem SpA (OTC:SAPMY) (Milan, Italy), Leighton Contractors, continues to build the $1.85 billion Gorgon jetty and marine structures. The cost of the project began at close to $1 billion, but the price increased by $800 million.

The Gorgon LNG project is worth a total of $52 billion.

For more information, see February 28, 2013, article - Leighton Contractors awarded Expanded Contract for Australia's Gorgon Project.

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