Australia: Total Cost of Gladstone LNG Project Remains USD 1.1 Billion

The Directors of Liquefied Natural Gas Limited announced that the estimated total cost of the Gladstone Fisherman’s Landing Project (LNG Project) remains at US$1.1billion.

This capital cost includes the engineering, procurement and construction (EPC) for the First LNG train of 1.9 million tonnes per annum (mtpa) LNG production capacity, including a 22km connecting gas pipeline, gas treatment and liquefaction plant, 200,000m3 LNG tank, jetty and ship loading facility and supporting infrastructure.

This cost also includes the Company’s share of dredging and dredge material disposal costs under contract with Gladstone Ports Corporation Limited, plus other project costs such as owner’s costs, project management, insurance and site lease payments during the construction period.

The Company and its EPC contractor, China Huanqiu Contracting & Engineering Corporation (HQC), the Company’s largest shareholder (19.9%), have been working together for nearly 12 months to establish the overall capital cost, based on a very detailed cost build-up of all components required for a fully operational LNG plant.

The Company and HQC are in the final stages of comprehensively reviewing and fully validating all costs and agreeing key EPC contract commercial terms, including plant performance guarantees, to enable the fine tuning and formal agreement of the EPC contract fixed price lump sum amount.

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Press Release, December 18, 2012