BG plans billion dollar drilling campaign for Qld CSG-LNG

BG Group PLC has been given the green light to begin a $1.7-billion (Aus.) drilling program in Queensland’s Surat basin as part of its commitment to the coal seam-based LNG project in Gladstone.

Up to 400 wells will be drilled in the next 2 years to maintain gas supply to the LNG plant.

Called the Charlie project, the drilling will take place west of the town of Wandoan. Leighton Contractors has won the main contract for the work.

Environmental approval for Charlie was granted by the federal government in December of last year.

BG began shipments of LNG from its Curtis Island plant near Gladstone in January and has delivered 62 cargoes since then to Asian markets.

The group needs to continue drilling new wells every year to maintain supplies.

China National Offshore Oil Corp. and Tokyo Gas are partners in the group and will fund part of the work. However BG will bear most of the cost because it has 73.5% interest in the gas permits.

The project also includes the laying of 725 km of water and gas gathering lines as well as a compression station, power lines, and water handling facilities. The facilities will be spread over an area of about 2,500 hectares.

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