Chevron said that 2014 would represent the peak year for spending on its Australian LNG projects as the company moves them closer to first production. “Overall, we have an attractive portfolio of investment opportunities which we will continue to fund in a disciplined fashion to grow value and shareholder distributions," said John Watson, Chairman and CEO.
Approximately 90% of Chevron’s 2014 spending programme is budgeted for upstream crude oil and natural gas exploration and production projects. Another 8% is associated with the company's downstream businesses that manufacture, transport and sell gasoline, diesel fuel and other refined products, fuel and lubricant additives, and petrochemicals.
The company said that its Gorgon LNG project was 75% complete after four years of construction. First gas is planned for midway through 2015 while production costs are estimated at US$ 54 billion.
LNG developments crucial
Vice Chairman George Kirkland said: "Gorgon project economics are attractive. We continue to make steady progress against key project milestones and are applying lessons learned to our Wheatstone development, which is almost 25% complete. Approximately 75% of our combined LNG offtake from the two projects is committed under firm, long-term sales and purchase agreements. These LNG developments are two of our most important future legacy assets, representing approximately 400 000 barrels a day of net production at full capacity. They will be substantial contributors to our cash flow for decades to come."
Adapted from press release by Ted Monroe
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