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Gorgon Final Investment Decision

By George L. Kirkland
Executive Vice President, Global Upstream and Gas
Chevron Corporation

Thank all of you for being here. Right up front, let me express our appreciation for the Australian Government and Western Australian Governments’ support. For without them, we wouldn’t be here today.

You’ve heard that today’s been a long time coming. Today is a celebration. A celebration of a lot of work. Gorgon has arrived. And the timing is great.

Let me tell you why.

Gorgon is a giant. The 40-year project will produce about 15 million tonnes of liquefied natural gas every year. That’s about 8 percent of current global LNG capacity. Let me repeat that. One project; 8 percent of global capacity. By any measure, that’s huge.

All that production will come from a network of fields that contain more than 40 trillion cubic feet of natural gas. That’s enough to power a city about the size of Adelaide … from now … until the year 2800. Again… huge.

Let’s talk about Gorgon’s timing: It works well.

During its construction phase, Gorgon will benefit from lower commodity costs. Remember, we’ve just gone through a downturn: that’s been good for Gorgon. During its production period, Gorgon will benefit from growing demand for natural gas, especially in Asia Pacific, our customer base. In fact, experts say that developing Asia has one of the fastest growth rates for natural gas consumption in the world.¹

Here’s another virtue: Gorgon will make a material difference.

For Australia, Gorgon will be a pillar of the economy for four decades. At peak construction, we’ll generate about 10,000 direct and indirect jobs. We’ll spend an estimated $33 billion² on Australian goods and services, with benefits trickling down through the economy of Australia, and particularly, the economy of Western Australia.

For customers in Western Australia and Asia-Pacific, Gorgon will supply cleaner-burning fuel for generations … and it will supply that fuel reliably. For partner companies, Gorgon will significantly boost reserves, providing stable and steady production for decades.

But that’s not all. What we do here today sets a new standard for the world to emulate. Gorgon redefines what technically-complex, environmentally-responsible projects will look like.

To remind you, the Gorgon Project will have:

• three, five-tonne LNG processing units or trains;
• the world’s largest carbon dioxide injection project;
• and a domestic gas plant.

This project will be subject to some of the most stringent standards imposed on any major project … anywhere in the world. We will not only raise the bar, we will clear it in one leap.

Let me give you an example.

The Gorgon Project will position Australia as a world leader in greenhouse gas storage. We plan on annually injecting and storing about 3.4 million tonnes of CO2 under the ground on Barrow Island. This will make Gorgon one of the most emission-efficient LNG projects in the whole world.

And while it’ll take a lot of sophisticated new technology to make this happen on Barrow Island, we’ll conserve the island’s protected plant and animal species. That’s due to our proposed quarantine system on the island, called the "world’s best practice" by the EPA.

So now you know why I’m excited: The project is big and it’s also coming at the right time, but Gorgon’s destined to become an iconic project for generations to come.

Forty years from now, people across Australia and Asia-Pacific will be living their lives, and running their businesses, fueled by the Gorgon Project we are launching here today. A legacy project with a massive investment is being set into motion today – one of which all of us can be proud.

¹ The EIA (Energy Information Assoc) has developing Asia with the fastest CAGR (compound annual growth rate) for NG. The IEA (International Energy Agency) shows a higher CAGR for the Middle East.
² Australian dollars