CIMIC updates on the Gorgon LNG contract

CIMIC has confirmed that a Notice of Dispute has been issued to Chevron pursuant to the relevant provision of a contract that it signed with its consortium partners – Saipem SA and Saipem Portugal Comercio Maritime LDA – for the Gorgon LNG jetty and marine structures project.

CPB Contractors Pty Ltd, a wholly owned subsidiary of CIMIC, and its consortium partners were originally announced as the preferred contractor to construct the Chevron Gorgon jetty and marine structures project in November 2009. However, during the project, the consortium submitted Change Order Requests (CORs), due to changes to the scope and conditions of the contract. 

Although negotiations have continued between the consortium, Chevron and Chevron’s agent, CIMIC believes that the process needed to progress to the next step, which is why the consortium has issued the Notice of Dispute. This Notice requires the consortium to enter into a prescribed negotiation process. If unsuccessful, this may lead to a private arbitration. 

CIMIC’s current share of the consortium’s total amount under negotiation equals approximately $1.86 billion. It believes that CPB remains entitled to that amount plus interest (an amount exceeding $500 million that will continue to accrue) and costs.

Edited from press release by Callum O'Reilly

Read the article online at: https://www.lngindustry.com/liquid-natural-gas/22022016/cimic-updates-on-the-gorgon-lng-contract-2030/