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BG CEO optimistic about QCLNG project

LNG Industry,

In the company’s Q4 2013 and full year 2013 results, BG Group CEO, Chris Finlayson, explained he is optimistic about the Queensland Curtis LNG (liquefied natural gas) project in Australia, despite concerns over the situation in Egypt.

“In 2013, we met all of our key milestones and continued to progress our growth projects in Australia and Brazil. In 2014, we will see first LNG exports from our QCLNG project in the final quarter and we will continue to ramp up production in Brazil. Clearly, we also have to address the near-term challenges we face in Egypt, and deliver our plans consistently and efficiently,” Finlayson explained.

In 2013, BG made important progress on its growth projects and delivered on all of its key milestones:

  • First gas was delivered onto Curtis Island before year-end, and the QCLNG project remains on track for first LNG in Q4 2014 and within the US$ 20.4 billion first phase budget.
  • QCLNG delivered a very good safety performance during its peak construction period.
  • The business environment in Egypt remained difficult due to the ongoing political and social instability, contributing to a reduction of 19 LNG cargoes in 2013, compared to 2012.


  • In December 2013, the QCLNG project delivered a key milestone with first gas transported from the Surat Basin coal gas fields onto Curtis Island, where the liquefaction terminal is located.
  • This milestone marks the successful completion of the 540 km pipeline network, comprising the gas collection header and export pipeline. Gas was introduced throughout the pipeline system in November and December and is now pressured up to full operating conditions.
  • The last of 80 construction modules for the two LNG trains arrived from Thailand in October and was set on foundation in November. Project construction is now in its final stages allowing commissioning activities to begin in Q1 2014.
  • The QCLNG project remains on schedule for first LNG in Q4 2014, and within the project’s Phase 1 US$ 20.4 billion budget.


  • In December, BG Group’s Prince Rupert LNG project received a favourable decision from the National Energy Board (NEB) for a 25-year LNG export licence for up to 21.2 million tpa. The Governor in Council will make a final decision on the licence.


  • The business environment in Egypt remains difficult, and BG Group has revised expectations of the value of its Egyptian operations.
  • Diversions to the domestic market during Q4 were higher than expected. The revised pooling arrangements for 2013 have not been honoured and domestic diversions are currently at around capacity, close to 1 billion ft3/d of gas.
  • BG Group has been unable to meet in full its obligations to deliver gas to Egyptian LNG and given the current levels of domestic diversions and the continued uncertainty around the level of future diversions, the company has served force majeure notices under its LNG Agreements.
  • BG Group remains committed to the Egyptian LNG Project and will continue to negotiate with the Egyptian authorities and other stakeholders to seek a long-term solution.


  • In December, Trunkline LNG Export LLC (Trunkline) completed pre-filing with the Federal Energy Regulatory Commission (FERC) for the Lake Charles LNG export project. This allows Trunkline, BG Group’s partner in the Lake Charles project, to file a formal application for FERC authorisation, expected by the end of Q1 2014.

Edited from various sources by Katie Woodward

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