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Unique pipeline system would meet about 15% of the region's needs by 2011

LOS ANGELES - 03/20/06 - Australia-based energy developer Woodside Petroleum Ltd. has unveiled a unique plan to build a state-of-the-art liquefied natural gas (LNG) pipeline system off the coast of Southern California that would supply the region with up to 15% of its LNG needs by 2011.
 
According to Wendy Mitchell, vice president for government affairs at Woodside's North American offices in Los Angeles, the proposed ''OceanWay Secure Energy Proposal for California'' plan calls for the construction of a 28-mile undersea pipeline that would connect with an underwater buoy off the coast.

The buoy would be used by specially-constructed tankers that would convert the LNG to natural gas onboard in a process that cools the LNG to minus 260 degrees Fahrenheit to shrink to 1/600th of its gaseous state.

There would be no permanent structure offshore and the buoy would be about 100 feet under the Pacific Ocean surface and would be the "size of a small room," she said, adding it would take three to five days to discharge a full tanker, depending on the speed needed to meet the region's LNG demand.

The proposed buoy terminal could handle from 800 million to 1.4 billion cubic feet per day - or about 24 million cubic meters to 42 million cubic meters - of natural gas within the next three years.

The first tanker would not unload gas until late 2010, when the Woodside-owned Pluto field off northwestern Australia is expected to begin production.

Another possible source of LNG for the project is the Woodside-operated Browse natural gas field also off the Australian coast that is due to begin production sometime between 2012-2014.
 
California consumes about 6.4 billion cubic feet, or about 192 million cubic meters, of natural gas a day, with half of that used to fire electrical power plants, according to the California Energy Commission in Sacramento.
 
Gas demand, the commission says, is expected to rise 0.7% annually in the next 10 years.

Woodside is expected to file the plan for the pipeline and buoy shortly with the three main permitting agencies - the US Coast Guard, the California Coastal Commission, and the California State Lands Commission - while the actual permitting process could take up to two years.

Actual construction of the pipeline would take about three months, said Mitchell.
 
Tankers like the ones planned for the Southern California project that can convert LNG onboard are currently in use in the Gulf of Mexico.
 
In March of last year, Excelerate Energy became the first in the world to perform an offshore delivery of LNG when its "Gulf Gateway" submerged buoy 116 miles off Louisiana received a 3 billion cubic-foot cargo from Malaysia, according to press reports.

Woodside would build its own tankers to carry Australian LNG. Construction of those 600-foot long ships would take three years, said Mitchell.

Cutler told a news conference via telephone on Wednesday that Woodside has talked with environmental organizations in order to mitigate opposition and will continue during the permitting process.
 
"We can locate this well away from shore," Cutler said, "and away from marine protected areas. It is not involving a permanent large facility."

The undersea pipeline would connect to the Southern California Gas pipeline near Los Angeles International Airport.
 
The plan to site the underwater buoy about 22 miles south of the seaside community of Malibu is not without controversy.

The Los Angeles Times recently quoted the mayor of Malibu, Andy Stern, who asserted "the vast majority of people in my city are opposed to any LNG facility. It's an environmental disaster waiting to happen."
 
Woodside executives responded to Stern, saying that Woodside has made more than 2000 LNG deliveries in 17 years in the business without incident.

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