Oil and Gas News

Shell delivers first Chile shipment

Australia has shipped its first liquefied natural gas (LNG) cargo to Chile from the Shell-operated Queensland Curtis LNG (QCLNG) project.

The cargo was transported aboard the Sevilla Knutsen and went on a 24-day voyage covering more than 13,500 nautical miles before docking at Quintero, Chile.

Shell has previously shipped its cargoes from QCLNG to China and Japan, while Quintero mostly imports its LNG cargoes from the Atlantic Basin. In 2019, Quintero imported cargoes from the United States, Trinidad and Tobago in the Caribbean and Equatorial Guinea in Africa.

The QCLNG project is a joint venture between Queensland Gas Company (owned by Shell), Australia Pacific LNG and Santos GLNG. As Australia’s leading natural gas producer, the project is focused on developing Queensland’s world-class onshore gas reserves.

“QGC produces natural gas from wells drilled into coal seams in the Surat Basin. Our operations include more than 2,600 production wells, 24 field compression stations, six central processing plants, two water treatment plants and a two-train LNG export facility on Curtis Island,” Shell outlined.

According to EnergyQuest, a cargo from Australia is unusual and shows the degree of over-supply in Asia.

Historically, Chile imported its gas from Argentina but decided to build an LNG import terminal after interruptions to Argentinian supply in 2004-5.

BG Group (now Shell) wrote a portfolio contract with GNL Quintero in 2006 to supply 3 million tonnes per annum (Mtpa) from 2009 to 2030.

The import terminal commenced operation in 2009, just 27 months after signing of the engineering, procurement and construction contract.

EnergyQuest further reported that the terminal has a major truck-loading facility in addition to supplying gas into pipelines.

“Wholesale gas prices in Chile averaged US$6.50 ($9.06)/one million British thermal units (MMBtu) in 2019 according to the International Gas Union,” EnergyQuest stated.