Chevron’s gas to power Australian alumina plants until late 2030s

Chevron Australia, a subsidiary of the U.S. oil and gas giant Chevron, has signed a new long-term sale and purchase agreement (SPA) with aluminum producer Alcoa of Australia to deliver natural gas from its Western Australian (WA) assets.

Under the deal, Chevron will supply Alcoa with a total of 130 petajoules of gas over a period of ten years starting on January 1, 2028. The gas sourced from the Gorgon, Wheatstone, and North West Shelf (NWS) facilities is set to be used in Alcoa’s alumina refineries in Western Australia. 

As stated by the oil and gas player, the Gorgon and Wheatstone gas plants’ combined capacity of 530 terajoules of gas per day equals about half of the gas supply in the country’s Western Australia state.

Chevron Australia Managing Director, Mark Hatfield, said: “Our significant investment in WA’s natural gas sector, including our share of the more than A$80 billion invested in Gorgon and Wheatstone, has powered the development of WA’s resources industry and continues to enable the long-term supply of reliable energy to the state.”

According to the President of Alcoa Australia, Elsabe Muller, the new contract plays an important role in securing the future of her company’s Western Australian operations.

“This agreement with Chevron forms part of our long-term energy strategy focussed on ensuring our refineries remain globally competitive whilst sustaining thousands of direct and indirect jobs and businesses in regional WA,” noted Muller.

All three of Chevron’s projects from which the gas will be sourced are seeking to obtain environmental approvals for additional operations. In May, the country’s regulator, the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA), confirmed that the oil and gas player submitted an environmental plan to drill the Wheatstone Deep-1 exploration well.

If approved, the activities aiming to search and evaluate deep gas reservoirs within the WA-47-L license within the Northern Carnarvon Basin off the northwest coast of Western Australia are scheduled to take place between 2024 and 2025.

Operated by Chevron on behalf of the Wheatstone joint venture, Wheatstone LNG processes gas from the offshore Wheatstone, Iago, Julimar, and Brunello gas fields, 220 km from Onslow, Western Australia. 

Next, a revised environment plan aiming to maintain the current production rates at Gorgon was approved in June. Operated by Chevron as one of the joint venturers, the project comprises offshore production wells and pipeline infrastructure that gathers natural gas from the Jansz–Io and Gorgon gas fields and transports it to a facility on Barrow Island, around 60 kilometers off the northwest coast of Western Australia, for processing. 

Hanwha Ocean recently completed the load-out of the field control station (FCS) destined to work on the project. Once installed, the FCS will receive high-voltage power from the Gorgon plant and supply low-voltage power to the production module installed in the Jansz-Io field while controlling the subsea production module.

As for the third project, environmental approval from the state government was obtained for the extension of NWS last week. Located on the Burrup Peninsula near the Port of Dampier and the City of Karratha in Western Australia, the NWS project is led by a joint venture between Woodside, which is the operator, BP, Chevron, Shell, CNOOC, and Japan Australia LNG.

The operations at Australia’s first liquefied natural gas (LNG) project comprise production from oil and gas fields located approximately 125 kilometers north-west of Karratha in water depths ranging between 80 and 131 meters.