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Shell’s Prelude to stay offline until deemed safe

Prelude FLNG

Shell’s ‘Prelude’ floating LNG (FLNG) plant suffered a serious setback last month after it was ordered to halt production by the environmental regulator following a fire onboard. 

The facility was directed to stay offline until Shell can demonstrate adequate safety measures, which may require the removal of 1.5 million tonnes of production off the market through 2022. 

The FLNG facility is located offshore, 475 km north-northeast of Broome in Western Australia, designed to extract, liquefy and store natural gas at sea before it is transferred and shipped to customers. 

In early December 2021, a fire was reported onboard causing a complete power outage on the facility, which was hosting around 200 personnel.

The incident prompted an onboard inspection and investigation by the National Offshore Petroleum Satety and Environmental Management Authority (NOPSEMA), which ordered the supermajority not to resume production. 

NOPSEMA has suggested a significant delay in the resumption of the plant in order to review the risks that could lead to a similar repeat incident. 

Shell must now prove to NOPSEMA that Prelude can safely recover from such power losses in the future before it can resume gas production.

The company will develop a detailed plan and schedule to implement corrective actions and present them to the regulator. 

Prelude is the world’s largest floating structure, and was set to be the first FLNG venture to be sanctioned worldwide. 

The facility is still not operational, and it is speculated that its absence may tighten an already strained international market for gas. 

The Prelude FLNG has the capacity to produce 3.6 million t of LNG a year. 

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