The Australian city of Darwin is set to be "the floating LNG capital of the world", Northen Territory state Minister for Primary Industry, Fisheries and Resources Kon Vatskalis says.
Speaking at the Australian Pipeline Industry Association Annual Convention in Darwin on Monday, Mr Vatskalis said the top end looked likely to become a hot-spot for floating liquefied natural gas (LNG) developments.
"Within 10 years, I suggest to you that we could have five to seven floating LNG projects under development or in production, and the Northern Territory will be the floating LNG capital of the world," he said.
Floating LNG is increasingly being considered by energy companies seeking to commercialise remote or `stranded' natural gas fields, with processing taking place offshore on large vessels, rather than being piped onshore to a plant.
Royal Dutch Shell's Prelude field, some 475 kilometers north-northeast of Broome, is set to be the world's first floating LNG development when it begins production in 2016.
Also, Woodside Petroleum Ltd (ASX:WPL) wants to use a floating LNG platform for its Sunrise project in the Timor Sea, despite the Timor Leste government calling for an onshore development.
Piping the oil to East Timor would be high cost and carried significant technical risks, Woodside said earlier this year.
"This development plan has now been submitted to the Australian and Timor Leste regulatory authorities and we will see how this progresses in due course," Mr Vatskalis told the conference on Monday.
"In addition to Sunrise, we have the Bonaparte floating LNG project proposed by the GDF Suez/Santos (ASX:STO) alliance for the Petrel, Tern and Frigate gas fields, some 250km to 300km to the south west of Darwin.
"This project is currently in pre-FEED (front end engineering design) and is targeting first production in 2018.
"A number of other smaller, stranded gas fields in the Timor Sea to the north and to the west of Darwin are also promoted as being under consideration for floating LNG development by companies with good credentials to deliver projects of this nature."
In addition to being the site for several floating LNG proposals, the top end had a win in 2008, when Japan's Inpex (TSE:1605) chose to pipe gas from its A$20 billion (US$18.6 billion) plus Ichthys project, offshore Western Australia, to an onshore plant at Darwin.
"The Ichthys LNG project is moving toward a ... final investment decision in the fourth quarter of 2011," Mr Vatskalis said.
"Construction is set to commence in early 2012 and the first LNG cargo is planned for early 2016."
(C) 2010 Asia Pulse Pte Ltd.