Chevron completes production increase at Australian gas plant despite strike threat

The nominal capacity of the Wheatstone project to produce natural gas for the Western Australian market has been increased by approximately seven percent to 230 terajoules per day (Tjpd).

Chevron Australia Pty. Ltd. announced the completion of the modernization just as workers are planning to go on strike for wages again.

In 2023, the Chevron Corp. subsidiary launched a multi-year plan to expand the facility, which also exports liquefied natural gas to Asia. Last year’s expansion increased Wheatstone’s domestic gas production capacity to 215 Tjpd from the original 205 Tjpd.

“The combined result of these two increases means Wheatstone now has the capacity to produce approximately 12 percent more domestic gas than it did two years ago,” Chevron Australia said in a statement on its website.

Together with production from the Gorgon project, the Wheatstone expansions have increased the company’s domestic gas production capacity to 530 Tjpd, almost half of the state’s daily production. Last year, the two plants accounted for 44 percent of Western Australia’s daily gas production, and Gorgon continues to supply more domestic gas to the state than any other plant, Chevron Australia managing director Mark Hatfield said.

“Last year, our Gorgon domestic gas plant achieved record production, delivering more gas to the WA market than any other plant. And for the second year in a row, we safely and reliably increased production rates at the Wheatstone domestic gas plant,” Hatfield said in the company’s news release.

“Achievements like these reflect our ongoing commitment to maintaining the state’s energy security, ensuring the continued supply of gas to our customers in WA and helping to meet growing gas demand.”

The Wheatstone expansions “optimise existing infrastructure,” Chevron Australia said. Last year’s capacity expansion included technical improvements and plant modifications.

According to the company, most gas exports from Gorgon and Wheatstone, as well as the North West Shelf facility, in which Chevron Australia holds a non-operating interest, go to Asian countries.

The company announced the completion of the upgrade despite a threat of strike action over the wage increases. Last year, strikes broke out at Gorgon and Wheatstone around the same time that Chevron Australia began the expansion work.

On Friday, the Offshore Alliance, a union made up of the Australian Workers’ Union and the Maritime Union of Australia, said its members would vote against a “substandard maintenance agreement” proposed by Altrad, a contractor to Gorgon and Wheatstone. Following the vote, the coalition plans to apply to the Fair Work Commission for a vote on what it calls protracted industrial action.

“Once again, Chevron facilities are becoming an industrial battleground as our Altrad maintenance workers take the fight to Chevron and Altrad to enforce results under industry standard EBAs (Enterprise Bargaining Agreements),” the Offshore Alliance said in a statement on Facebook. In Australia, an EBA (Early Tariff Agreement) is agreed terms between workers and their company that set minimum working conditions.

Altrad, Altrad Australia and Chevron Australia have not responded to Rigzone’s requests for comment on Friday.

Chevron Australia operates Wheatstone with a 64.14 percent interest. Kuwait Foreign Petroleum Exploration Co. holds 13.4 percent, Woodside Energy Group Ltd. 13 percent and Kyushu Electric Power Co. 1.46 percent.

Chevron holds a 47.3 percent operating interest in Gorgon. ExxonMobil Corp. owns 25 percent, Shell PLC 25 percent, Osaka Gas Co. Ltd. 1.25 percent, MidOcean Energy LLC 1 percent and JERA Co. Inc. 0.417 percent.

In the Wheatstone and Gorgon fields, Chevron has undeveloped resources of approximately 235 million barrels of oil equivalent, according to the company’s annual report for 2023.

To contact the author, send an email to [email protected]