Woodside Petroleum CEO Optimistic as Big Decisions Loom on Browse LNG Project in Australia

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Researched by Industrial Info Resources (Perth, Australia)--Anticipation continues to grow about the controversial, $40 billion Browse LNG project possibly being constructed to the north of Broome, at James Price Point, as the final investment decisions are being discussed. Peter Coleman, the chief executive officer and managing director of Woodside Petroleum (ASX:WPL) (Perth, Australia), recently expressed optimism, and hopes continue to strengthen that the Browse LNG project will proceed.

"We're very pleased with the information we have in front of us to make the decision," Coleman said. "The advantage we also have is that we now see the market starting to roll over on the cost side; we haven't seen decreases, but we're seeing a flattening, which gives us a bit more confidence we're not chasing costs up."

He explained that with the West Australian construction sector cooling, a technical breakthrough is not necessarily needed. The final decisions regarding Browse will be made by the government-set date of June, and Coleman suggests that the gas prices will remain strong.

It was only recently that Woodside, the operator and partial owner of the Browse project, gave its partners the final cost and schedule estimates. The partners are Royal Dutch Shell plc (NYSE:RDS.A) (The Hague, Netherlands), BHP Billiton (NYSE:BHP) (Melbourne, Australia), BP plc (NYSE:BP) (London, England), Mitsubishi Corporation (TSE:80580) (Tokyo, Japan) and Mitsui & Company Limited (TSE:80310) (Tokyo).

When it came down to whether or not the costs are viable for this onshore project, Coleman said: "I never said it wasn't viable. I know some people are speculating on that, but Browse is a world-class resource--it's 3 billion barrels of oil equivalent, it's just offshore, and it doesn't have all the CO2 some people would like you to think. In fact, it's less than Gorgon."

Coleman continues to speak highly of the Browse project. "We're seeing the market flatten off, so the 12 months that we've taken on Browse to do the extra work--to give us assurance around cost and schedule--has been very well spent."

Since the project is said to not need a technological breakthrough, such as floating LNG, and with costs in the Western Australian construction sector easing up, Coleman continues to have high hopes for the final decisions that are planned for June.

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